MF put expiration question

K

Kicking

I was long the June 5 put for that stock. It was a small bet that it would crater too much lower levels when MF and IB collapsed two months ago. I got out at 0.5 today for a 0.20 loss anyway I didn' t expect to be filled.

My question is why did anyone buy it if not to cover a short position? If MF collapsed under 5 over the weekend and since the options expire saturday can someone make a profit over the weekend ? I believe you can get assigned after the expiration if the stock moves after the close so I suppose if you are long calls for example you can still make a profit after the last trading day. But what happens when you are long puts and the stock drops under your strike either in after-hours or Monday before the open ?
 
1) Don't be too concerned with the "other guy's" motivation for taking the other side of your trade.
2) It could have been an offsetting or initiating trade.
3) A trader may have merely done a favor for someone else by filling your one-lot order.
4) If something dire had come about to make MF worthless before final exercise, newly opened positions could be exercised into short-stock which would be highly profitable with respect to the put-option premium.
 
What happens Monday doesn't matter because the options expired. After hours Friday can push the stock in one direction or another and cause assignment on Saturday. Not sure why you got filled on those out of the money puts though. Thank your lucky stars I guess
 
You must log in or register to reply here.
Back
Top