Hi AW,Saint,Smart_Trade,Dan,
If I sell a call/put option. what are the various ways I can close out the position. Before expiry and at expiry.
Regards
Sanju
Hi
ST has explained you some ways to work with your sold call or put.
I will add a bit to expand your knowledge about option trading.
To make it simple, I will use only the short call. So you can make it vice versa with the put.
If you are short a call, you expect market moves down.
If this happen now and you see for what ever reason, that market start to go up, you buy back your short call and add/buy an other long call slightly otm to your position.
You now have looked in your profit from the short call and you have a no cost money long call for an up turn of the market.
Such strategies can be traded in swing markets and can be fine tuned.
Tc
DanPickUp