How to record an option sale?

fredericch

Is an option sale categorized as a "sell" or a "Short Sell" or something else? When it expires or gets exercised, is it a "Buy" or a "Buy to cover"?

Rocket J Squirrel

When you write a call, you are selling something you don't own. So it is always recorded as a short sale.

fredericch

I should maybe specify that I'm using Mac Quicken Deluxe 6.3.3, if that makes a difference. It seems that often there are big differences between Windows and Mac versions!

Rocket J Squirrel

No need to guess. If you opened the position with a Buy, close it with a Sell. If you opened with a Sell Short, close with a Cover Short.

fredericch

That makes sense. Thank you. I guess my underlying question was how to record an option. Does it make a difference in reporting or calculating returns if I enter a covered CALL sale as a 'Sell' or a "Sell Short". Should all options be recorded the same way, or is it case by case (covered or not covered, etc)?

Rocket J Squirrel

When you write a call, you are selling something you don't own. So it is always recorded as a short sale.