Question about options
#1
Posted 17 August 2007 - 09:20 PM
#2
Posted 17 August 2007 - 09:30 PM
Equity options expire the 3rd saturday of every month. Since there is no trading on saturday... why is this?
After hrs today DNDN shares jumped 15% and some guy on CNBC's fast money said that someone is still able to capture value in the august options because they dont expire until tomorrow. IS this True?
Yes, technicaly options expire on Saturday.
#3
Posted 17 August 2007 - 09:38 PM
#4
Posted 17 August 2007 - 11:54 PM
YES. Assuming that you never sold your calls that were, as the end of the regular session and end of options session --out of the money-- then you still own those calls tonight.You can exercise them by buying the stock at strike price, and then sell that stock Monday (or whenever you wish) at what has now become the market price.....Of course you've gotta pony up for the stock you are buying by exercising options, AND you take ovenight risk that market is still there Monday when you want to sell.....Equity options expire the 3rd saturday of every month. Since there is no trading on saturday... why is this?
After hrs today DNDN shares jumped 15% and some guy on CNBC's fast money said that someone is still able to capture value in the august options because they dont expire until tomorrow. IS this True?
#5
Posted 18 August 2007 - 12:44 AM
Here's IB policy on exercise.
Stock options expiring in the current month that are $0.05 or more in the money will be automatically exercised by the OCC without the need for any explicit instructions from IB.
Index options expiring in the current month that are more than $.01 in the money will be automatically exercised by the OCC without the need for any explicit instructions from IB.
The OCC must receive "contrary intentions" through the TWS Option Exercise window if you want to:
exercise a stock option that is in the money by LESS than $0.05.
exercise a stock option or index option that is out of the money.
#6
Posted 18 August 2007 - 11:12 AM