If you want to close your short call but you lack the funds to buy it back, you can often roll the short option for a net credit. "Rolling" involves a single, multi-leg order to: Buy to Close your current short call while simultaneously Sell to Open a new call on the same underlying stock, but at a later expiration date. You structure the roll so that the premium you receive from selling the new, longer-dated call is greater than the cost of buying back your current call. This results in a net credit to your account. Because the entire trade results in a credit, it doesn't use any of your options buying power.

Options trading is not suitable for all investors due to its inherent high risk, which can potentially result in significant losses. Please read Characteristics and Risks of Standardized Options before investing in options.

Please note that this article is for general informational purposes only and is believed to be accurate as of the posting date but may be subject to change. The examples above are for illustrative purposes only.

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