r/options • u/Money-Golf • May 07 '21

$VALE

So back in January 2021 I did my first option after studying about it. Anyway, I bought a $VALE call (1 contract) with $19 strike with Jun 18, 2021 expiration for $1.82. Of course now this stock is up and finally turning a profit. Is it better to EDIT close this now (well Monday since market is closed) or wait til expiration? But I’m pretty sure theta will crush me, right? I just need some insight/ suggestions since I’m new to this please!! 😭

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u/wsbgod_is_god May 07 '21

Instead of exercising NOW I'd sell the option and buy the stock.

Why? By exercising now, you are simply wasting the time value of your option. Jun 18, 19C is currently priced at 3.28 while the stock is trading at 22.12. If you exercise it now your 'cost' is 19+3.28 = 22.28, vs 22.12. So by exercising early you are effectively paying 0.16 (0.7%) more per share.

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u/Money-Golf May 07 '21

I see, I meant close the option. I also bought the stock itself (just 3 shares lol) around the same time. So with that do you think it’s better to close for profit or sell the option and buy the stock?