Ok look, I would like to buy some options to back up my shares in KDR. I know the strike is 15c exercised by next April.
I keep reading about one written contract being 100 shares but one option purchased is only 1 share right?
If someone can just throw a quick few numbers at me I'll be sorted.
e.g I buy 100 tomorrow @ 55 and the share price continues in an upward trend for the next 4months. The true cost if I exercise later is 70c so if I think it will continue upwards it is in my best interest to exercise and gain more shares under market price right? And the advantage is I guess I can buy much more now as an option @55 and pay the strike at a later date (all going well)
*Nothing in reply to this will be treated as advice*,
I just need a laymans chat on options to back up my limited understanding.
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Ok look, I would like to buy some options to back up my shares...
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