Hello, I'm new to the land of trading options but I think I have a good grasp of them on the basic level. That being said, I don't know how the following makes any sense:
Questrade is showing me CALLS for Jan 18th 2019 with a strike price of $20 and only at a cost of ~$12. These calls are being traded, there's volume, bid sizes and ask sizes > 0. There are various CALLS around a similar price range.
Now my understanding was that I could purchase 100 of these for $12 x 100 = $1200. I could then immediately exercise these options (is this wrong?) and purchase 100 shares of TSLA at a total cost of $20 x 100 = $2000. I could then sell these shares at ~$268 each for a grand total of $26800. Minus costs (ignoring exercise fees as they're nearly negligible here) and I'd be left with a profit of $23 000 ??
What am I missing? Are these options simply not actually available? I see other calls for Jan 2019 that seem far more realistic like $72 dollar cost for a $230 strike price.
Cheers and thanks for the help
Questrade is showing me CALLS for Jan 18th 2019 with a strike price of $20 and only at a cost of ~$12. These calls are being traded, there's volume, bid sizes and ask sizes > 0. There are various CALLS around a similar price range.
Now my understanding was that I could purchase 100 of these for $12 x 100 = $1200. I could then immediately exercise these options (is this wrong?) and purchase 100 shares of TSLA at a total cost of $20 x 100 = $2000. I could then sell these shares at ~$268 each for a grand total of $26800. Minus costs (ignoring exercise fees as they're nearly negligible here) and I'd be left with a profit of $23 000 ??
What am I missing? Are these options simply not actually available? I see other calls for Jan 2019 that seem far more realistic like $72 dollar cost for a $230 strike price.
Cheers and thanks for the help
