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Hello. I know Chris had a long thread on assignment, but I am still confused by a few things. Let's say you own an AAPL 665/670 12 Oct long vertical call spread. 12 Oct comes along and the stock closes at 664.95, and you decide to let the vertical expire worthless. At 4:10 PM the stock goes up to 671 in after hours training. You will get assigned on the short 670, but what happened with the 665 long you owned? What I have read about most brokers if the option is $.01 in the money they will auto-exercise it for you, but in this case the stock closed OTM. Additionally, let's say you have an account with $30k in it and you own10 of these verticals. How could you even purchase the 1000 shares? Thank you for your time!

Just wondering if anyone has ever had success negotiating with TOS to reduce/remove the $19.95 fee that TOS charges for assignment and exercise. If so, what kind of arguments worked best? I agree with Kim that we shouldn’t have to negotiate to get the best rates. However, I greatly prefer TOS’s platform to anything else out there. I’ve been using tastyworks for a while now too, and their platform is only ok, but it’s still a work in progress, and they still charge $5 for assignment/exercise. The reason I’m asking - and not considering IB’s $0 assignments- is because I’m evaluating a couple of candidates for wheel trades (sell puts, get assigned, sell covered calls, get assigned, rinse/repeat). Since the cycle involves two assignments, the $40-ish total fees at TOS is cost prohibitive. And I refuse to use IB because of their auto-liquidation algorithm - I don’t want to have my account blown up if I get assigned on a couple of different positions one night and don’t have a chance to close things out within 10 minutes of the market opening. So if I could get TOS to come down or eliminate their assignment fee, that would be great. Otherwise I’m stuck with TW - I suppose I’ll get more used to their platform over time, but everything about their apps makes me feel like I’m playing an arcade game from the 80s. And not in a good way.... Any input is greatly appreciated!

By Christopher B. Welsh I've had three emails in the past month on people being assigned on positions and receiving margin calls, and generally not knowing what happened. I advise everyone to completely research and become familiar with the exercise/assignment aspect of option trading. If you don't you can find your entire account blown out over a weekend. Assignments occur in two basic varieties. First, on expiration Friday (or Thursday or Wednsday depending on the instrument your trading, but most commonly on Friday). If you have a position that is .01 in the money, or more, you WILL be assigned. For instance, if you have a 100 Call on stock XYZ that expires today, and XYZ closes (AFTER HOURS) at 100.01, you will find that you own, sometime Saturday, 100 shares of XYZ that you paid $100/share for. Click here to view the article

Say I have an options strategy which requires me to hold a Synthetic short stock position for 1 year. So that's: a Long put with 1 year expiration + a Short Call with 1 year expiration, with both at the same Strike price. My strategy requires me to hold it for at least 1 year. However, lets say 6 months into the year, my short call is deep in the money and gets assigned, so I am obligated to fulfill it. Now my multi-leg strategy is broken as my short call position is gone. How would I go about reconstructing it so I can continue on the position for the rest of the year?Would I just Instantly sell the same calls at the same strike price with the same expiry? I assume the credits from selling the same calls would essentially cover the loss from the assignment, and the position would continue on? Thanks

Hello. Recently I was researching what happens if I hold a covered call through earnings. I came across this article on theoptionsguide.com http://www.theoption...ered-calls.aspx It discusses writing a covered call but shorting a DITM call to try to scalp the dividend. It seems the reasons this strategy will not work is because it is likely you will be assigned on that DITM call. However could someone explain to me how that would work? Let's take a hypothetical example: GD ex-dividend date 10/3 for $.51 a share Let's say GD is trading at $65.00 On 10/2 during the day you go long 100 shares and sell a $63 Oct call for $2.00 even. On 10/3 the stock drops and closes at $64.50 What would happen regarding you being assigned? Also do you need to be long the shares on 10/2 or is getting long the shares on 10/3 sufficient to receive the dividend when it is payed? Thank you!