Hello,
I am reading about about how you can “buy back” a covered call you sold. You would do this if the stock is losing value and you want to get out of the stock.
However, no concrete fully-worked example is provided in the texts I have read (books, online). So I created my own example. I was hoping someone could evaluate if my example is realistic in terms of the money flows. For simplicity, I am eliminating transaction costs:
The stock is selling at $84.
You buy 100 shares.
The…