covered call - Sell to open or Sell to close

Nophotosm Brokerage Account

Posted by rlh on May 01, 2009 (02:40PM)

I am trying to write my first covered call and I am confused about writing the covered call. Do I write it as Sell to open or Sell to close? What is the difference? Thank you. 

Posted by TK-Stefan on May 01, 2009 (02:44PM)

rlh,

If you are writing your first covered call you would select "sell to open". The difference is that in this case you are selling the option to open the covered call position. A sell to close would be when you are selling an option that you currently own, that is when you would use "sell to close". I hope this helps! If you have any further questions please let us know.

Best regards,

Stefan McVeigh
TradeKing Customer Support
Nophotosm Brokerage Account

Posted by rlh on May 02, 2009 (08:48AM)

This helps me out. Thank you for your help.

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