Getting full profit on Stock/Commodity options at expiration

[Diesel 10]

The folks on this board have been good to me so I thought I'd let you in on a little secret.

 

If you have some options well in profit, you will often find that the Market Makers will try to screw you on expiration day by maintaining a wide bid/ask spread. Lets say you own 10 of the ten strike calls and the stock is trading at 12. You may find that the bid/ask spread is 1.70/2.30 . Rather than selling the options for 1.70, try this instead: right at the close, short 1000 of the shares. Then when you are assigned the shares over the weekend they will be offset by the shares you are short. In effect, you will receive the full 2.00 value of the options and thus make an extra $300.

 

Conversely, in the case where you own in the money puts, you can buy an equivalent amount of shares right at the close to realize the full value of your in the money puts.

 

Hope this is helpful. :)>-

[Lost Marble]

I sell puts and do exactly the same the same thing if they are in the money. I just sell the stock short and end up square after assignment.

[kashmiami7]

Unless the stock is expensive :) Do you have any ideas for that?

[sweetyy]

I want to ask from you about my business stock... I have big stock in my warehouse of summer collection of dresses but its now old in fashion so what can I do now for making profit from this stock... I am so worried about this so help me for expending my business...

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Edited April 2, 2011 by sweetyy

[juicyt]

As funny as this comment is, I have a feeling you were serious!

[Guest grandpost]

what are good option courses; and will learning how to trade options improve my overall understanding of the markets and fx;