A stock will only be hard to borrow for shorting not for buying. And if it's to really short a hard-to-borrow stock, it will be to buy a put and then exercise it. It wouldn't be to buy a call. And usually when the stock is really hard to borrow, the broker wouldn't even allow you to keep the short transaction open; it will demand you to buy back the stock to close the short right away so it'll be a much ado about nothing.
Got assigned on call options
- Thread starter blueraincap
- Start date
A stock will only be hard to borrow for shorting not for buying. And if it's to really short a hard-to-borrow stock, it will be to buy a put and then exercise it. It wouldn't be to buy a call. And usually when the stock is really hard to borrow, the broker wouldn't even allow you to keep the short transaction open; it will demand you to buy back the stock to close the short right away so it'll be a much ado about nothing.
Or bought a call instead of a put and then exercised it thinking it will protect against a price drop. Either way the guy is a noob.
Actually it was a slightly cynical response from me (sorry!). Because you start with a completely wrong stock price (as parts of the day of exercise the option was considerable ITM) and put up a whole story after that.
But anyway, we leave it to the (lucky!) TS to filter out the useful parts from this topic...
But anyway, we leave it to the (lucky!) TS to filter out the useful parts from this topic...
The strike is at $18 but the market price of the underlying is at $15 and somehow the OP got assigned. That's how I understood it.
Thanks for clarifying your sarcasm.
No, underlier was around $19 that day!
(he even says "name at $18.70" but that is not relevant as exercise was done the previous day)
Last edited:
What was the underlying's price at the time of the exercise?