**Options Help**
Hi,
Hopefully someone can help me understand this a bit better because I thought I had it down but then the outcome of my situation confused me lol.
This was a test account so I could see how it works live.
I bought a 1 Put option on BABA last week, strike price In The Money at $148.00 and the bid/ask mid point was 7.00 so I paid $7 for the option.
So with this information it was my understanding that the stock needs to be $7 down before my option hits break even, so $141.00 for break even and from this point on each point the stock dropped from there was pure profit. One thing I noticed was my option on my order window started to show break even/ moving into profits at $143 so when it was dropping below here I was in the green, this part I don't understand? I thought It wouldn't show any profit until it broke below $141?
So today I sell to close the put option when BABA came all the way back up just above $144.25 area, I market sold to close off quick and the "AVG" price was showing 5.85 but when I check my broker statement online the "Closing Price" was showing 3.74.
So my platform shows I took a $115 loss on the option but on the actual online statement it shows I took a bigger loss on the option at $325.
Confusing me to death so hopefully someone can help clarify haha.
Edit: I can understand the $325 loss because break even is mean't to be $141 so closing at $144.25 would produce a loss of 3.25, I guess my broker platform showing profit at the $143 mark is some sort of error or I'm maybe misunderstanding something?
Thanks for your time.
Regards,
Steven
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Last edited by Stev86; Nov 9, 2018 at 6:51pm.
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