Rolling (an Option)

Rolling means closing an existing option position and opening a new one at the same time — usually at a later expiration, a different strike, or both — to adjust a trade already in progress rather than letting it run to expiration. A trader rolling a covered call that's gone in-the-money, for example, buys back the current call and sells a new one further out in time, often at a higher strike, to avoid an assignment they're not ready for or to reset the strike further from the stock's price. A roll can come out as a net credit (collecting more than you pay to close) or a net debit (paying more than you collect), depending on the strikes and expirations chosen. Rolling doesn't eliminate the underlying obligation — it postpones and reshapes it — and rolling repeatedly just to dodge assignment can end up costing more in net debits than simply accepting it.