Rolling Up
If an option is close to expiration but the stock is in the middle of a strong uptrend, rolling up is a good way to lock in profits but stay in the trade until the trend runs it’s course.
Selling your long call with a lower strike while simultaneously buying a new call (in the next month) with a higher strike. Produces a credit that locks in profits while keeping the same trade going. Less money will be at risk because it’s been rolled out along the way.
October 13, 2007
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