how to make big money exercising options: can I exercise puts/calls without having the cash or shares on hand to buy/sell? via /r/wallstreetbets #stocks #wallstreetbets #investing


how to make big money exercising options: can I exercise puts/calls without having the cash or shares on hand to buy/sell?

Help I might be an idiot and i definitely don't know what I'm doing but I have 200 shares of Ford (F). I bought a put with a 15.5 strike expiration today. If I exercise it before or at expiration (in the money) do I have to sell 100 of my shares? Or can I somehow simultaneously buy 100 shares at the current price (say $15) and sell those same 100 shares at the strike of $15.5, or is that a good faith violation because I didn't want 2 days for it to settle? I want to do this instead of selling 100 of my existing shares because I've sold 2 16 strike calls against them at the same time, and I don't want my calls to be uncovered. How do people make this big money exercising options? Do you have to always have the cash/shares on hand to buy/sell when you exercise? I get holding enough cash for a call, but a put it would seem you'd want to take advantage of a short term price discount and exercise, but you Have to buy the shares on your own? So you still need cash to exercise it? Help

Submitted August 05, 2022 at 04:14PM by Teddys-Big-Stick
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