Quote:
Originally Posted by Sparky***
What does that mean for those of us who don’t speak stock nonce?
|
I think in the next 30 days , they are able to place a buy order at the agreed stock price of the call action .
Say the price is 5 pounds today and you place a call action in. In 3 weeks time if you wanted to buy shares of the club in large volumes you can purchase them at 5 pounds a share (based on the contract) Even if in three weeks time the share price has gone up to 7-8-9 pounds
It’s done when there is expectation of the share price is to go up. So what happens is the shares get purchased at a lower than share value price and then can be sold to the market at the actual value, thus making a quick buck.
Atleast that’s why I’ve been told, I’m no financial expert