Hi , New member.
Just looking for a confirmation of my understanding of the UK options ( so far been only active in US - mostly selling covered calls and selling puts to top up a "long term" portfolio )
Lets take VOD as an example
In UK , prices are quoted in pence for stocks. So price of 161p per share.
Call option for Oct at strike 170 is quoted 4,25 , and Put for Oct at strike 150 is quoted at 5,25.
So am I correct in thinking that if I sell Call options I will receive 4,25p x 1000 = GBP 42.50 for each contract of 1000 shares. Therefore If I own 10,000 shares I could sell 10 contracts and receive GBP 425 ( assuming a covered call scenario )?
Using the same logic , if I hope to pick up more VOD at 150p , I could sell Put options at GBP 52,50 per each 1000 shares I would be willing to buy ( if price drops to 150p per share)
Thanks for your confirmation or correction
Just looking for a confirmation of my understanding of the UK options ( so far been only active in US - mostly selling covered calls and selling puts to top up a "long term" portfolio )
Lets take VOD as an example
In UK , prices are quoted in pence for stocks. So price of 161p per share.
Call option for Oct at strike 170 is quoted 4,25 , and Put for Oct at strike 150 is quoted at 5,25.
So am I correct in thinking that if I sell Call options I will receive 4,25p x 1000 = GBP 42.50 for each contract of 1000 shares. Therefore If I own 10,000 shares I could sell 10 contracts and receive GBP 425 ( assuming a covered call scenario )?
Using the same logic , if I hope to pick up more VOD at 150p , I could sell Put options at GBP 52,50 per each 1000 shares I would be willing to buy ( if price drops to 150p per share)
Thanks for your confirmation or correction
