Sold call option never got exersised !

Quote from Bitstream:

You mean at and above 10 cents of strike.

Right?
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or below if it's a put... but i always thought it was .75 in the money. i certainly wouldn't wanna excercise unless i've hedged it by selling short or buying long the underlying right before market close on Friday.

can you imagine getting excercised on GOOG (for .80 in the money) only to have GOOG gap up/down in the opposite direction on Monday morning?

Good Trading.
 
Quote from cloned777777:

is that the general rule..or does it change from broker to broker?
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Each brokerage firm has a procedure that is spelled out in your account agreement forms. The Options Clearing Corporation ("OCC") uses the 75 cent threshold for customer orders, but your firm may have a different threshold. Here is how The OCC describes it:

EXERCISE BY EXCEPTION

“Exercise by exception” is an administrative procedure used by The Options Clearing Corporation ("OCC") to expedite the exercise of expiring options by Clearing Members. In this procedure options which are in-the-money by specified threshold amounts are exercised unless the Clearing Member submits instructions not to exercise these options. “Exercise by exception” is a procedural convenience extended to OCC Clearing Members, which relieves them of the operational burden of entering individual exercise instructions for every option contract to be exercised. It is important to note “exercise by exception” is a procedure between OCC and its Clearing Members and is not intended to obviate the need for customers to communicate exercise instructions to their brokers:

“The exercise thresholds provided for in Rule 805(d) and elsewhere in the rules are part of the administrative procedures established by the Corporation to expedite its processing of exercises of expiring options by Clearing Members, and are not intended to dictate to Clearing Members which positions in customers’ accounts should or must be exercised.” (Rule 805, Interpretation .02)

EXERCISE THRESHOLDS

Expiring options subject to exercise by exception use the following thresholds to trigger exercise:

Equity options: 3/4 point per share in-the-money in the customer account; 1/4 point per share in-the-money in firm and market maker accounts. Index options: $1.00 per contract in-the-money in all account types.

Expiring options are determined to be in-the-money or not based on the difference between the exercise price and the “closing price” of the underlying security.

The “exercise by exception” procedure for expiring options described above is sometimes incorrectly referred to as “automatic exercise”. It is important to note “exercise by exception” always allows an OCC Clearing Member to effect a choice not to exercise an option that is in the money by the exercise threshold amount or more, or to exercise an option which has not reached the exercise threshold amount. The exercise threshold amounts used in “exercise by exception” trigger “automatic” exercise only in the absence of contrary instructions from the Clearing Member. Because the right of choice is always involved in “exercise by exception”, exercise under these procedures is not, strictly speaking, “automatic”.
 
Quote from omcate:

Each brokerage firm has a procedure that is spelled out in your account agreement forms. The Options Clearing Corporation ("OCC") uses the 75 cent threshold for customer orders, but your firm may have a different threshold. Here is how The OCC describes it:

EXERCISE BY EXCEPTION

“Exercise by exception” is an administrative procedure used by The Options Clearing Corporation ("OCC") to expedite the exercise of expiring options by Clearing Members. In this procedure options which are in-the-money by specified threshold amounts are exercised unless the Clearing Member submits instructions not to exercise these options. “Exercise by exception” is a procedural convenience extended to OCC Clearing Members, which relieves them of the operational burden of entering individual exercise instructions for every option contract to be exercised. It is important to note “exercise by exception” is a procedure between OCC and its Clearing Members and is not intended to obviate the need for customers to communicate exercise instructions to their brokers:

“The exercise thresholds provided for in Rule 805(d) and elsewhere in the rules are part of the administrative procedures established by the Corporation to expedite its processing of exercises of expiring options by Clearing Members, and are not intended to dictate to Clearing Members which positions in customers’ accounts should or must be exercised.” (Rule 805, Interpretation .02)

EXERCISE THRESHOLDS

Expiring options subject to exercise by exception use the following thresholds to trigger exercise:

Equity options: 3/4 point per share in-the-money in the customer account; 1/4 point per share in-the-money in firm and market maker accounts. Index options: $1.00 per contract in-the-money in all account types.

Expiring options are determined to be in-the-money or not based on the difference between the exercise price and the “closing price” of the underlying security.

The “exercise by exception” procedure for expiring options described above is sometimes incorrectly referred to as “automatic exercise”. It is important to note “exercise by exception” always allows an OCC Clearing Member to effect a choice not to exercise an option that is in the money by the exercise threshold amount or more, or to exercise an option which has not reached the exercise threshold amount. The exercise threshold amounts used in “exercise by exception” trigger “automatic” exercise only in the absence of contrary instructions from the Clearing Member. Because the right of choice is always involved in “exercise by exception”, exercise under these procedures is not, strictly speaking, “automatic”.
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exactly what i said....:)
 
Quote from omcate:

Each brokerage firm has a procedure that is spelled out in your account agreement forms. The Options Clearing Corporation ("OCC") uses the 75 cent threshold for customer orders, but your firm may have a different threshold. Here is how The OCC describes it:

EXERCISE BY EXCEPTION

“Exercise by exception” is an administrative procedure used by The Options Clearing Corporation ("OCC") to expedite the exercise of expiring options by Clearing Members. In this procedure options which are in-the-money by specified threshold amounts are exercised unless the Clearing Member submits instructions not to exercise these options. “Exercise by exception” is a procedural convenience extended to OCC Clearing Members, which relieves them of the operational burden of entering individual exercise instructions for every option contract to be exercised. It is important to note “exercise by exception” is a procedure between OCC and its Clearing Members and is not intended to obviate the need for customers to communicate exercise instructions to their brokers:

“The exercise thresholds provided for in Rule 805(d) and elsewhere in the rules are part of the administrative procedures established by the Corporation to expedite its processing of exercises of expiring options by Clearing Members, and are not intended to dictate to Clearing Members which positions in customers’ accounts should or must be exercised.” (Rule 805, Interpretation .02)

EXERCISE THRESHOLDS

Expiring options subject to exercise by exception use the following thresholds to trigger exercise:

Equity options: 3/4 point per share in-the-money in the customer account; 1/4 point per share in-the-money in firm and market maker accounts. Index options: $1.00 per contract in-the-money in all account types.

Expiring options are determined to be in-the-money or not based on the difference between the exercise price and the “closing price” of the underlying security.

The “exercise by exception” procedure for expiring options described above is sometimes incorrectly referred to as “automatic exercise”. It is important to note “exercise by exception” always allows an OCC Clearing Member to effect a choice not to exercise an option that is in the money by the exercise threshold amount or more, or to exercise an option which has not reached the exercise threshold amount. The exercise threshold amounts used in “exercise by exception” trigger “automatic” exercise only in the absence of contrary instructions from the Clearing Member. Because the right of choice is always involved in “exercise by exception”, exercise under these procedures is not, strictly speaking, “automatic”.
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Actually, exercise threshold for equity options has been reduced to 0.25 from 0.75.

However, since the original poster was talking about futures options this threshold may not be appropriate.
 
Quote from cloned777777:

Suppose I sell a call, then the next day it is in-the-money,
and suppose the person who bought the option resells it instead of exercising it.

Does this mean that I am not obligated to fulfill the obligation to deliver the underlying ?

And If I was covered ( took a long position ) during the time I sold the call, that means i will now make even more money from the underlying.

eg.

sold spt call Eur futures options strike 1.2250 ( went long 1.2230 at the same time since futures was trading at 1.2230 then )

Now , futures is 1.2355 ( +105 )..
but the person who bought the call that I had sold did not exercise it, but instead resold it for his take profit.

I was covered when I had sold the option...but since the person who bought it never exersised it 9 but resold it ),

So I am now assuming that the long position used to cover the sold call option is not under obligation to be delivered.
Am i right ?

So that means I can make the 105 pips since I was long @ 1.2230 to begin with when I was long .

Am I day dreaming ?

elite traders rock :)
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I am afraid you are daydreaming. You have to remember that for every buyer there is a seller. If the person who initially brought your call sold it, it means that someone else owns your call. So, unless you buy back your call, someone may exercise it. So your future is still under obligation to be delivered.
 
Quote from loufah:

Sure - see http://elitetrader.com/vb/showthread.php?s=&threadid=51251 for the story of someone this actually happened to.
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WOWOWOOOOOWWW!!

i've only read the firs few posts. this is a very powerful post for me, as i've always let my OTM expire worthless.

NOW, for sure if it's got any chance of going in the money, i'm gonna put in an order to "sell to close" at .05 (or even .10) ask GTC. as soon as it hits the threshold that it's in the money for such amount, I'M OUT"

what a wake-up call for me! i play goog and cme, so it hits really close to home.

Thank you very much!

Good Trading to you...
 
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