Alan answers a question posed by Lisa, who asks:
Alan, I am trying to figure out how to use the What Now tab and wonder if you can assist me with the following situation. I (fake) bought Shopify (SHOP) on Monday for $466.50 at a strike of 500 for a bid of $13.40. Today, the stock has risen to $475.64 with an Ask buy back price of $17.45. I was thinking possibly to roll-out or roll-out-and-up and was trying to understand the calculations within the What Now tab of The Ellman Calculator. If I wanted to roll out, using the same strike of 500 and same date of call, Feb 21, in an attempt to Hit a Double and the spreadsheet shows minimal gain or a loss. Can you kindly advise me what I’m doing wrong? Thanks! Lisa
——— It’s the 2nd Wednesday of the month. Time for another original episode of Ask Alan. AA#173, “ Rolling Out-Of-The-Money Strikes Early in The Contract” If you want more “Ask Alan” videos, you can! Become a premium member today, and tune in to the educational power of the complete library!
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