Sell near same quantity out of the money call of that share.

Question

Accepted Answer

Selling near same quantity out of the money call of a share involves selling call options with a strike price higher than the current market price.

Out of the money call options have a strike price higher than the current market price.
Selling these options allows the seller to collect premium upfront.
The seller believes that the share price will not rise above the strike price before the option expires.
This strategy can be used to generate income or hedge against potential losses.
Example: Selling 100 out of the money call options for XYZ stock with a strike price of $50 when the current market price is $45.

Accepted Answer

A call option is considered out-of-the-money (OTM) when the underlying asset's current market price is lower than the option's strike price. Exercising the option in this situation wouldn't be profitable because you'd be buying the asset for more than its current market value

Accepted Answer

Out-of-the-money (OTM) options are cheaper than other options since they need the stock to move significantly to become profitable.

Sell near same quantity out of the money call of that share.

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