Options Question re: Sale

[Strategist]

Hello. I am new to the forum. I have been trading stocks for a year and a half or so, and I am considering trading in options. I have done alot of homework on the subject, but have made no actual trades as of yet.

My question is when you buy a call option, then later choose to sell the option, is it sold automatically? OR does there have to be someone willing to buy that option?

In my opinion, there are times that someone holding an option would want to sell, when there would be no logical reason for someone to want to buy that option. (For one example, the last few minutes before an option expires.)

[Mark Wolfinger]

Hello,

Someone has to be willing to buy it. But, unless the option is very far out of the money and it's near expiration, there is almost always someone who will be willing to buy it.

Market makers are obligated to continuously post a bid price and an option price for every option in the pit in which they trade (or have their computers set up to trade for them).

Yes, there certainly are times when an option owner should want to sell. But it is unreasonable to expect anyone to want to buy an out of the money options a few miinutes before it expires.


You can always enter the order to try to sell, but the trade is NOT automatic, and the market makers are allowed to bid zero.

Best regards,
Mark