Chapter 8 Closing Positions: Profit, Exercise, or Roll
Don’t wait for the Last Judgment. It takes place every day.
̶̶ Albert Camus, The Fall, 1956
Every option will be canceled by a closing transaction (a sell order against an original buy, or a buy order against an original short), by exercise, or by expiration. The results of each affect buyers and sellers in different ways.
A “long” option is buying. You buy a call hoping the underlying price moves up, or you buy a put hoping the underlying price will go down. A long option is bought, and it is closed with a sell order.
A “short” option is selling. You sell a call hoping the underlying price moves down, or you sell a put hoping the underlying price will go up. A short position is sold and ...
Get Options now with the O’Reilly learning platform.
O’Reilly members experience books, live events, courses curated by job role, and more from O’Reilly and nearly 200 top publishers.
