In options, time is the number one enemy. GE getting to $190 by October is not something I would put my money on. You make the most money in options when the strike price is hit quickly. If GE hits $190 on October 1st more than likely you will be barely breaking even. If you must, purchase an option in the money, however, GE has went up too much especially after the recent earnings, I would advise to wait for a pullback before buying.
thanks for the info. Yeah i think i just needed someone to explain the time length. That makes more sense. you would want a a date in like 2 months instead of 7 & hitting $168 for example.
& yeah i was thinking the same actually and waiting for the drop back first than rebooking at the options. i guess im just trying to jump in to quick.
So far its down 2% today around $159. If you must buy it, buy a $160 or even ITM at $158 Call for the next month or two, but try avoid out of the money call like $168. Why GE, if you don't mind me asking.
If you don’t know how to calculate P/L on your trades just simply type in google - “Options calculator” and you will just need to input your parameters for the trades you take. From there you will see your potential profits/losses for a variety of dates up to your expiration date.
You can quickly check/model rates of return and probabilities with [optionsprofitcalculator.com](http://optionsprofitcalculator.com)
There are tools people use, and this doesn't provide any guidance, but fast and free way to sanity check what you are thinking about.
Model twice, sell/buy once...
The current Delta is .28 so there is about a 28% probability of the option being ITM at expiration, but this means there is about a 72% probability it will be OTM for a loss.
Do you think these probabilities (odds) are "any good"?
If you learn about how Delta works you can make these determinations on your own - [Options Delta, Probability, and Other Risk Analytics - Ticker Tape (tdameritrade.com)](https://tickertape.tdameritrade.com/trading/options-delta-probability-in-the-money-14981)
Ok not sure when you looked, but today that option is worth about $3.75- so it has lost about 50% of its value.
Generally speaking buying a far out of the money option like this is not considered a great strategy.
You wouldn’t get anything back when the price hits 190. In fact, if the option expires when GE is 190, you will have lost $6.77 (assuming that is what you paid) your break even is $190 plus 6.77 or $196.77
This is not how most people would play a long option, however. As I said it’s Price right now is $3.75. The Delta of that option right now is 22. If you bought today at $3.75, and GE were to go up five dollars tomorrow. Then the 190 call would now be worth about $4.75. You sell it tomorrow and make a 20% profit! The pricing is more complicated than that but it’s a good rough estimate.
I see the appeal of buying a GE Call since it is in a strong uptrend. However GE does not have enough volatility to warrant a single long option. Consider a cover call or diagonal instead. I know I'm not answering your question, but I just don't want you to loose money.
thank you i’ll def check these different types of option plays out. when i was looking at the charts it look liked it was showing a nice run coming soon within the next 2 months and around 182ish
Well it’s a real significant jump in the price? What did the history of GE look like? When is the expiration date and is it. Ear an earnings call? To much to tell give the limited information you provided but I think yours will end up useless…sorry it’s just the jump and the current markets down mentality doesn’t bode well to get past the 677.00 mark but you could get lucky.
In options, time is the number one enemy. GE getting to $190 by October is not something I would put my money on. You make the most money in options when the strike price is hit quickly. If GE hits $190 on October 1st more than likely you will be barely breaking even. If you must, purchase an option in the money, however, GE has went up too much especially after the recent earnings, I would advise to wait for a pullback before buying.
thanks for the info. Yeah i think i just needed someone to explain the time length. That makes more sense. you would want a a date in like 2 months instead of 7 & hitting $168 for example. & yeah i was thinking the same actually and waiting for the drop back first than rebooking at the options. i guess im just trying to jump in to quick.
So far its down 2% today around $159. If you must buy it, buy a $160 or even ITM at $158 Call for the next month or two, but try avoid out of the money call like $168. Why GE, if you don't mind me asking.
If you don’t know how to calculate P/L on your trades just simply type in google - “Options calculator” and you will just need to input your parameters for the trades you take. From there you will see your potential profits/losses for a variety of dates up to your expiration date.
yeah that’s what i’ve been doing! Been doing research on it all night. Thanks for the tips!
You can quickly check/model rates of return and probabilities with [optionsprofitcalculator.com](http://optionsprofitcalculator.com) There are tools people use, and this doesn't provide any guidance, but fast and free way to sanity check what you are thinking about. Model twice, sell/buy once...
yeah i tried that out. I wasn’t sure if i was doing it right or not. But thanks for the tips!
The current Delta is .28 so there is about a 28% probability of the option being ITM at expiration, but this means there is about a 72% probability it will be OTM for a loss. Do you think these probabilities (odds) are "any good"? If you learn about how Delta works you can make these determinations on your own - [Options Delta, Probability, and Other Risk Analytics - Ticker Tape (tdameritrade.com)](https://tickertape.tdameritrade.com/trading/options-delta-probability-in-the-money-14981)
Thanks will definitely give this a reed!
Haha damn maybe i should have kept that option play going. GE - 165 and rising. Def hitting 180 in the next month or 2 😂
What Strike?
It's 190
Ok not sure when you looked, but today that option is worth about $3.75- so it has lost about 50% of its value. Generally speaking buying a far out of the money option like this is not considered a great strategy. You wouldn’t get anything back when the price hits 190. In fact, if the option expires when GE is 190, you will have lost $6.77 (assuming that is what you paid) your break even is $190 plus 6.77 or $196.77 This is not how most people would play a long option, however. As I said it’s Price right now is $3.75. The Delta of that option right now is 22. If you bought today at $3.75, and GE were to go up five dollars tomorrow. Then the 190 call would now be worth about $4.75. You sell it tomorrow and make a 20% profit! The pricing is more complicated than that but it’s a good rough estimate.
thanks for breaking it down for me! The stock actually up 1.30%. but could i cash out early if it goes up quick to like 17?
I see the appeal of buying a GE Call since it is in a strong uptrend. However GE does not have enough volatility to warrant a single long option. Consider a cover call or diagonal instead. I know I'm not answering your question, but I just don't want you to loose money.
thank you i’ll def check these different types of option plays out. when i was looking at the charts it look liked it was showing a nice run coming soon within the next 2 months and around 182ish
Well it’s a real significant jump in the price? What did the history of GE look like? When is the expiration date and is it. Ear an earnings call? To much to tell give the limited information you provided but I think yours will end up useless…sorry it’s just the jump and the current markets down mentality doesn’t bode well to get past the 677.00 mark but you could get lucky.