Lets say there is a stock that is currently trading at $100/share. I wanna buy a call option for May 1st, with a $90 strike price, and the premium is $5.
I would then pay $5 x 100 = $500. Since the option is "in the money" because the current share price of $100 is above the strike price of $90, I could immediately exercise the option. Because the strike price + premium is $95, and share price is $100, my profit would then be $5 x 100 = $500. Is this right?
New to options trading, so sorry if this is a low-IQ question. US-based stock if it makes a difference. Is there a minimum amount of time I have to wait to exercise the option or something else I'm missing? I found a stock that is in a similar scenario so I wanna know if i can make some easy money... lol.
If there are other, smarter plays with in-the-money options or low-risk low-margin ways to make money with options I would be happy to hear them.