I am a newbie to the options game. I am in the options game for cashflow and cashflow only, so I don't really care about the underlying stock.
I am wondering why someone would roll up/over vs being exercised.
I buy share XYZ for $1.46 and write a call for $1.50 ($0.10 premium). The price goes up to $1.60 (the first price that I could likely to be exercised, right??). I decide to Roll up to $1.70, so I buy back the original call for $0.17 (probably??) and write a new call for $0.06. So I costs me $0.11 to keep the $0.14 Capital Growth. So I sacrifise my $0.11 cashflow for the Capital gain (less two lots of brokeage)
If I get exercised then I recieve the $0.04 cashflow (less one lot brokeage). Then I have the option to rebuy share XYZ or move onto something else.
Am I looking at this the wrong way or is there something I am missing???