Newbie Options Question...a little help.

[yoyomama]

Can somebody explain a newbie options question to me.

For instance...AAPL stock opens today at 206.85, closes at $207.88.
The FEB 210 calls open at 6.45 & close at 5.75.

This is basic Options 101 no doubt but I can't quite get a handle on that.

[skiracer]

Can somebody explain a newbie options question to me.

For instance...AAPL stock opens today at 206.85, closes at $207.88.
The FEB 210 calls open at 6.45 & close at 5.75.

This is basic Options 101 no doubt but I can't quite get a handle on that.

The feb 210 call is most likely experiencing what they call time decay Yo. in many occassions as the option gets closer to expiration the time element becomes a very important factor. there are millions of options traders out there using these options as hedges or any number of other strategies involving stocks that they own or just a play on that specific option and as the expiration date gets closer the time decay becomes more and more significant. as it gets closer to expiration there is less and less time for a move up or for the position to perform the way someone might expect it to perform. take a look at the mar/april/may options at the same strike price and see how they performed today. instead of a negative move you will probably see a positive move or less of a negative move. there are numerous factors that come into play with options that affect them much differently than stocks. and when you think they would move in accordance with a stocks move they won't as in this case.

[yoyomama]

Hey thanks for that Ski. I looked at the same strike price calls that were further out & they also seemed to have finished down even though the stock was up.

I guess ones that were In The Money finished up like the stock did. Probably all of the above factors & then some.

Again thanks.

[skiracer]

Hey thanks for that Ski. I looked at the same strike price calls that were further out & they also seemed to have finished down even though the stock was up.

I guess ones that were In The Money finished up like the stock did. Probably all of the above factors & then some.

Again thanks.

Yo,
when a stock call or put option is "in the money" they almost always move in sync with the way the stock moves and at the same price movement. when "out of the money" they have a mind of their own and unknown circumstances can dictate their weird movement like what you are experiencing.

[skiracer]

I received a free offer today from Barchart. OpVest (option investments, inc.) are offering their free options trading suite to anyone that would like it. it is free and is a great starting off point to learn about options and option strategies. like i said it is FREE and very informative if you are wanting to learn about options this is as good a guide as you will find for free. if you want it give me a email address here or pm it to me and i will forward the email to you and you can take it from there. It is for FREE and well worth the time and trouble.

[wooish]

Ski

Can you please PM me the link? Thank you much.

[steelman]

options expiration

Does anyone know what happened to an call option at expiration if you are in the money and you never sold it?

Thanks,
Steel

[skiracer]

Does anyone know what happened to an call option at expiration if you are in the money and you never sold it?

Thanks,
Steel

steel, i'm pretty sure that at or before expiration you have to either sell or close out the call option, exercise the right to buy the stock at the strike price, or the option will expire on the expiration date and then it is worthless to you regardless of what or where it was at price wise.

[microchips]

Hi fellas i am with optionsxpress and on the day your options expire regardless of what state they are in they automaticaly sell them for you,they send a couple of e-mails one or two days prior to expiration date to let you know what they will do if you dont if you know what i mean.Regards Nick

[skiracer]

Hi fellas i am with optionsxpress and on the day your options expire regardless of what state they are in they automaticaly sell them for you,they send a couple of e-mails one or two days prior to expiration date to let you know what they will do if you dont if you know what i mean.Regards Nick

Thanks micro,
how long have you been trading with options express? i've been using them for a number of years and have only the highest regard for their trading platform and whole operation. never have had a problem. it's strange that with all the trading in options i have done over the years i never let a position go or past expiration. i would have thought that i would about what you just posted. thanks, it's worth knowing that little point.