If I exercise an option at the strike price, do I receive that price for my shares?

Asked 4 years ago

Rookie question. Selling covered calls, if it hit the strike price and the buyer chooses to exercise the option, the seller receives the strike price for their shares. Correct? So, if I bought WKHS for 7.49, and sell a 10 call, I get the 10 per share if the exercise it when it hits in the money. Yes?

Selling covered calls Strike price Exercise option Trgovanje opcijama

Andia Rispah Igobwa

Monday, June 07, 2021

Yes. You keep the premium regardless of whether or not it reaches the strike price. You always have the option to roll your calls out a week or more, too, if you decide not to assign them.
Bit always be careful with WKHS; you can quickly lose. But yes, you receive the premium and the amount of the strike price per share.
Plus, try not to close a covered call position unless premiums have changed. Never take a loss. Also, don't expect to be assigned early. If it hits the strike, it will be automatically assigned, but you can choose to exercise the contract early if you want to.