Need help in closing a trading position

[optioner]

Hi,

I am a newbie and need some help from the Gurus here.

I have bought OPTSTK-ASHOKLEY-25Mar2010-50.00-PA @ 0.60. As the underlying has moved up I don't see benefits if I hold on till expiry.

Can I initiate a "sell-to-close" transaction this week to close the trading position and limit my losses? (the current premium is 0.20)

What do the gurus advise?

Thanks

 

[chitale9]

Hi,

Yes you can do it.

Regards
RBC

 

[rkkarnani]

You can exit your position any time till expiry at market price, there is no restriction!!

 

[trader.trends]

As a seller of options you have to pay the brokerage +STT+other taxes. Pl calculate your cost before closing position. Check the following post for details

http://www.traderji.com/beginners-g...-brokerage-stock-exchange-transactions-4.html

The money you recover by selling at .20 must be worth more than what you will pay for the transaction.
Brokers also have a minimum brokerage charges. You have to find out from your broker about that.

 

[AW10]

Agree with TT's reply.
In many cases, it is cheaper to let the option expire worthless then trying to close it and
pay brokerage on it.

Generally, brokers charge fixed min fee per lot .. which generally hits us for such low premium options. Cause the brokerage calculated as % of premium will be too less.. hence they stamp min charge ..

Also keep in mind that you are going to sell this option so look at the price at which next buyer is bidding there.. As of today's market close, the price that a buyer is willing to pay is 15 Paise.

Check out with your broker.

 

[optioner]

Thank you everybody for the advice.

My broker charges a min fee of 100 per lot.

Since the lot size here is 9550, guess it still makes sense to close and save couple of thousand. Am I right?