Today, we are going to look at an example of a failed bull put credit spread trade. In fact, the trader woke up Friday morning to see that he was assigned 100 shares of Tesla, even though it was not at the expiration of his option. This is known as an early assignment. Let’s see … Read more
In part 1, we learned the basics of option assignment. In this part 2, we will continue our learning journey into more complex scenarios of option assignment. Contents Consider an investor selling a bear call spread on Costco (COST) with the short call at the 15-delta. Date: January 10, 2025 Price: COST @ $927.50 Sell … Read more
As a new options investor, I know that the topic of option assignment can be complex and scary. But once you fully understand all the possible possibilities, that may alleviate some of the fears. Contents Before we get too deep, we need to know that there are two types of options: American-style and European-style options. … Read more