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Question on covered call

Question on covered call# Stock

n*m2010-06-29 07:06

1 楼

No Chinese input, sorry!
When I sell a covered call, do I have to hold the underlying stock until the
expiration date??
THX!

p*p2010-06-29 07:06

2 楼

no.. but if the stock ends up above your call price you'll be asked to come
up with these stocks, resulting in a short position

the

【在 n***m 的大作中提到】

: No Chinese input, sorry!
: When I sell a covered call, do I have to hold the underlying stock until the
: expiration date??
: THX!

n*m2010-06-29 07:06

3 楼

So if that happens, what would I do? Do I need to buy back the stocks and
sell to the buyer of the option?

come

【在 p*******p 的大作中提到】

: no.. but if the stock ends up above your call price you'll be asked to come
: up with these stocks, resulting in a short position
:
: the

n*m2010-06-29 07:06

4 楼

PLZ help! THanks!

o*p2010-06-29 07:06

5 楼

Depends on account type
1IRA or cash account, they will hold you shares, sell is not allowed.
2. Margin account, selling shares=sell naked call. Then you will have to
meet margin requirement. If when exp. call exercised, you will short shares.

s*h2010-06-29 07:06

6 楼

in the case of "covered" call, yes, you'll be required to hold the
underlying stock until either the options are exercised or expired. it doesn
't matter if you have a margin or cash acct. in fact, i believe margin acct
is required to enable the options feature on your trading acct.
if you really want to get rid off the shares, you have to buy back the short
position you established. hopefully, the stock is not too much in-the-money
for you to take a loss.
i wrote in an earlier post that the app