er in direction (up for a call), (down for a put), to your strike price at purchase, the more valuable your position becomes? And as the price per share moves away in direction, (down for a call), (up for a put) the less valuable, possibly even a loss ...your position becomes?
In other words, being in the money really only counts when you want to exercise the option to buy or sell the stock from the writer of that option? So that an options buyer does not have to ever be in the money to make money.
Am I correct here? Cause I notice a lot of people buying near the money and maybe there is some advantage, but not quite sure what that is.
2007-12-13
14:44:38
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2 answers
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asked by
Anonymous
in
Investing