Question Regarding Options Trading, using lowes for a example
Looking at purchasing Lowes call option with strike price at 25.00. for $1.55. Currently lowes stock is selling at 23.50. If i purchase 10 call options my cost is $1550.00, is this correct.
If so say that lowes stock jumps up to 24.00 sending the call option up to $1.95.(theoretically) Is there any way that I can cash out of the option and collect my projected profit, or am i locked into the option until it expires
Projected profit- 1000 x.40(change in option price)= $400 -commision charges.
As well to do the above trade do I need to own 1000 shares of lowes stock or can i just own the option on lowes stock.
Any help would be appreciated
2007-11-28
16:39:49
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10 answers
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asked by
newbie
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