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Originally Posted by myselff77
Can you explain the above? I think this is what I don't understand. Can you re-sell the options before the 1 year date and make money at a price below the $20 call?
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Yes, options trade daily and you can buy and sell them at anytime.
These options have 1 yr to expire. If Ford gets to lets say $15-16 in the next 3-4 months, the options I bought at $53 a contract will be worth about $250-$300.
The downside will be if Ford goes nowhere or down over the next year and these options will slowly leak oil and expire worthless.
You can literally buy 1 contract for $55-56 and that could be your trial.
You need to read up on options before you risk real money.
If you have a large portfolio, options can be used as a hedge for the downside and lock in some additional money if you write covered calls on the stock you own.