Naked Call

if yesterday you had -3 calls on XOM and the client exercised,

today you'd have 0 calls, -300 XOM, and whatever 300*the strike price in cash.
 
What about a naked put that I wrote. Let's assume that it is in the money for the person who bought the put, for example 1 point below the strike price that I wrote it for, do I get assigned the stock, or do they just take money out of my account, on expiration?
 
Quote from oraclewizard77:

What about a naked put that I wrote. Let's assume that it is in the money for the person who bought the put, for example 1 point below the strike price that I wrote it for, do I get assigned the stock, or do they just take money out of my account, on expiration?
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You will (most likely) be assigned.

Friendly warning: if it's barely ITM, the option *may* be abandoned without exercise, and you won't find out until the next day. Similarly, if it's barely OTM, the option may still be exercised... (at least in futures; not positive about equities).
 
Quote from oraclewizard77:

What about a naked put that I wrote. Let's assume that it is in the money for the person who bought the put, for example 1 point below the strike price that I wrote it for, do I get assigned the stock, or do they just take money out of my account, on expiration?
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You get the stock.
 
Quote from cigarno:

Ok.... Can you borrow the stock instead of buying it?!
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Yes. You can always carry a short stock position - but only when your broker can borrow the shares.

Plus - some brokers charge you a fee to carry short stock, so be certain to inquire about the specific stock - preferable before you are assigned.

Mark
 
0k.....here is an example you get assigned to deliver the stock and you do own the stock how does the borrowing mechanism work in order for you to deliver the stock?!
 
Quote from cigarno:

still which comes first:
(1)- you get paid the strike price and then you deliver
(2)- you deliver the stock and then you get paid the strike
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It's kinda like which came first, the chicken or the egg?

It's neither. It's the one smoking the cigarette.

:)
 
scientists say that the EGG came first. About 2 million years ago a bird laid an egg with muted genes and the chicken was born..........
 
EGG came first, Aliens used the Earth as a giant Petri dish and dropped off 1 egg to see the effects from far away.

Aliens are laughing at the idiotic things we do on a daily basis and now we are being broadcast on all the galactic cable networks for pay per view.
 
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