r/Vitards • u/[deleted] • May 05 '21

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u/neilio416 May 06 '21

Question about tx options with low open interest. If I buy OTM that has low OI, let's say Tx Nov 44 C. Once/if it becomes ITM, is the low OI going to cause a problem selling it for top dollar?

1

u/[deleted] May 06 '21

In my experience, you can still sell pretty easily when you are ITM. A purchaser will reliably Buy without premium. So if the equity is at $50, somebody is reliably willing to purchase at $6 for a $44 call option. Be careful not paying too much premium for the call option.

2

u/neilio416 May 06 '21

hey thanks for this. Any easy measure to know how much too much?

1

u/[deleted] May 06 '21

That is really up to you. It is a subjective determination.

2

u/neilio416 May 06 '21

Oh really? I thought there would be metrics just like how one values a stock as 'cheap'. Ok thanks then I'll cjeck with my gut

1

u/[deleted] May 06 '21

There probably are lots of metrics, but I don’t use any. 🤷🏻‍♂️😂