Options Trading Tutorial

If I have 1 day left to exercise stock options?

should I sell all(buy $12, sell $19) same day, sell to cover, or cash exercise? Thanks! I no longer work for the company. But by the 31st , I have 438 shares to buy at $12. It's selling today a $19. Is it a good idea to do a same day sell?

Public Comments

1. You perform a financial analysis of all the options. Since you provided scant details, there's no way to know. If you truly have options, one would expect you to be smart enough to figure this out on your own.
2. You have learned by now that to invest in something so complex without knowledge or a plan is akin to financial suicide. Usually, to exercise would be to take possession of the stock (if we are talking about stock at all and not oil futures or cattle). We don't know how many contracts you own, or whether you are short, but each contract involves100 shares of stock. Do you want to own this stock? If not, don't exercise. Do you have enough money to purchase this many shares of this stock? If not, don't exercise. If you don't know what you're doing, don't exercise. Otherwise, you might end up with a truck load of cattle on your lawn in the morning.
3. Sounds as if you have "cashless options?" http://www.investopedia.com/terms/c/cashlessexercise.asp If yes, and the option will expire 01-31-2010, and your strike price is $12 and the stock price is $19, and you don't want to own the stock beyond this time, SELL! You have $7 profit per option x 438 shares thus, $3,066 capital gain less broker commission sale costs. I have no idea what stock this is, but based on the information you have given if it were my money in the same situation, I would exercise the option fast. See profile for full disclaimers: http://profiles.yahoo.com/u/CUXTCCBSBYDZODXWGYK2IZDOOI Thank you for asking an original question that I have not answered about cashless options since I started here on Y!A 3 years ago.