AgEng06 said:
In at 0.80 after I closed 30k's 450P for a profit. Now let's go bulls!
So does this pay $100 per $1 SPX closes over 450? Is that how it works? (minus premium, in my case $80)
If this is your first time on XSP, it's unlike a typical option as it is a euro-style option. It cash settles meaning no shares to worry about.
If you buy a 450c and at expiration the equity is at 450.18 you'll get .18 x 100, 452.00 would net you $2.00 x 100.
And if it's under 450 you get zilch. I like these on Fridays because you can get your lotto and walk away and truly let it zero or hero.
And all of my risk-off strategies work here too. Say I buy the 450c for $.90 and then a runup happens and I sell the $452c for $.90. I now have a zero risk 2-dollar wide vertical spread.