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The week's question
In December 2024, in the thread "Re: BRK: Why Not XOM?", BreckHutHigh asked the members: "What about the long road trips with kids?" This week it is put to everyone again. The button below opens the small thread re-asking it - read what others have said so far, then give your own answer as an ordinary reply.
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Stocks A to Z / Stocks B / Berkshire Hathaway (BRK.A)
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Author: Mark   😊 😞
Number: of 21944 
Subject: Re: Bought to close
Date: 04/25/24 3:27 PM
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"If you have written the calls you are at the mercy of the purchaser. They can and will get called early."

But only very rarely, and only by complete option novices. Basically, someone who does this likes to give away free money.

Look at any random option in the money. Let's say the BRKB 405s expiring tomorrow. Someone (a novice) might choose to exercise the option right now and buy it for 405 with the shares trading at 406.10, they would get the shares for a net discount of 1.10. But why on earth would they do such a thing when instead they could simply sell the option for somewhere between $1.191 and $2.03 (current bid and ask). Heck, even if they want a quick fire sale, like instant execution, and they sell for $1.50, they would still extract more value from that option than by exercising it. But this is true for ALL options in the money, even with 1 day left, there is always a small bit of time premium in the option.
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This community has written 21,448 posts about Berkshire Hathaway. The article-length ones it recommended most:
BRK: Why Not XOM? · 62 recs · 2024
Second quarter comments · 60 recs · 2023
Berkshire's Profit Contributors · 57 recs · 2023
Summary of 2Q 2026 · 54 recs · 2026
3Q Summary · 53 recs · 2024
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