I've read the various responses about your perceptions about getting ripped off, etc.,etc. so lets clear up the matter...
A rip off/scam is perpetrated when something is occuring that is fraudulant. i.e. You weren't disclosed all of the facts and didn't really know what you were getting yourself into.
Anyone that opens an option trading account must receive and declare that they have read and understood the OCC's Options Risk and Disclosure Booklet. In that book it CLEARLY STATES these exercise limits, therefore they are disclosed and open - I really am surprised that someone who is the principle of a trading group is unfamiliar with something as basic as the automatic exercise limits of listed options - oh well, live and learn...
There is not some evil conspiracy going on here in the attempt to screw the public out of their money. When the option exchanges evolved in the early seventies, the exchanges instituted a courtacy to provide a wide safeguard for owners of options who did not turn in their exercise notices. This was 3/4 of a point for public customers and 1/4 point for professionals.
At the time commissions were a lot higher than they were, and thankfully have declined with the advent of ecns and discount brokerages. That said, the rule has been constant all of these years and is still effected as a wide safeguard for owners of options - some of whom still trade their original full service accounts.
I do not accept the arguement that someone other than yourself is responsible for your trading decisions, profits or losses. When I worked on the retail side of the business I always turned in an exercise notice for my clients, irregardless of how far in the money their options were.
It is your responsibility as an adult and a professional? trader to ensure that your options are exercised - nobody elses. Aside from exercising you could simply liquidate the position prior to expiration, roll it into another month if you wanted to keep it on, submit an instruction not to exercise, etc.
Stock, you strike me as the type of person who puts in a GTC sell order well above the market, and then whines and declares that they have been ripped off when the stock runs and the order is filled. I've explained to you that I don't want to take the risk of being pinned at the strike for the reward in question. If you reaaly feel that this is a good trade for you then go for it... Bring your $100,000 down to the floor. It may work for a while, but when your underlying moves violently away from your strike and you are locked into it over the weekend it may bankrupt you - I've seen it happen. It's your money, you're a grown up (I think), take responsibility for your own trade - don't assume or be under the wrong impression - ascertain facts regarding the instrument you trade, don't oversleep and definatley don't forget to take actions that can materially affect your perfromance.
Def- you have debated me for almost a week regarding the ISE and it's liquidity and now you admit that you have never even traded one contract. In fact, the extent of your experience is that you've talked with and watched over the past two days...
Do you want to try and convince me that markets are efficient and that it is impossible to outperform them too? You know, there's lots of statistics and studies to support that point. But, I have personally seen that that's bullshit too.
I stand by my comments. I even called my old clerk in Chicago and he told me that "it still sucks". However, that said, it should be more than adequate for many of the people on this board.
The Knight
