causing the call options to have negative extrinsic value, which causes people to exercise them
Duly noted. That seems like a good time to buy back the calls. And then buy some more to exercise yourself. Not sure how long this lasts. Maybe it’s enough to watch it twice a day, or maybe you have to program an order in advance.
Once the merger happens [...], there is no longer a $10 floor.
How much warning do we get to redeem the shares? Maybe that’s when you buy back the put. Although, if everybody thinks that at once and drives up the IV even more, maybe that’s time to sell another one instead.
Duly noted. That seems like a good time to buy back the calls. And then buy some more to exercise yourself. Not sure how long this lasts. Maybe it’s enough to watch it twice a day, or maybe you have to program an order in advance.
How much warning do we get to redeem the shares? Maybe that’s when you buy back the put. Although, if everybody thinks that at once and drives up the IV even more, maybe that’s time to sell another one instead.