Why do some brokers prohibit sell,and then assign?

R

rabmanducky

About 3 years ago, I came upon a situation where I had to resort to selling a stock, and then excercising it. There was a huge spread on bid and ask. And the bid wasnt reflecting the value of the options by 20 cents. I held 310 2.50 put options on mirant. And I was in a sticky situation because the options were 3 days from expiring. I asked if he could sell, and then excercise. He said sure. And it was done. But at another broker 6 years ago, i came upon another situation like that, and he gave me a long winded excuse that he can't do that. It is against regulations.
My question is why do some brokers allow selling, and then assigning? And why do some brokers only allow shorting and assigning?
 
excercise an option. Some brokers allow you to sell the stock and then excercise. But some firms prohibit that for some reason. And they only allow short and then excercise. Or some firms make you excercise and then sell. How come?

Quote from MTE:

You cannot exercise a stock, only an option can be exercised!

Clarify your question!
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Can you be more specific about your position? Was a long stock and a long put or was it something else?
 
long put.

Quote from rabmanducky:

excercise an option. Some brokers allow you to sell the stock and then excercise. But some firms prohibit that for some reason. And they only allow short and then excercise. Or some firms make you excercise and then sell. How come?
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My guess would be incompetent broker, or maybe it was a cash account or something similar. I guess you'll have to ask your broker for a reason if you still experience this problem.
 
Quote from rabmanducky:

About 3 years ago, I came upon a situation where I had to resort to selling a stock, and then excercising it. There was a huge spread on bid and ask. And the bid wasnt reflecting the value of the options by 20 cents. I held 310 2.50 put options on mirant. And I was in a sticky situation because the options were 3 days from expiring. I asked if he could sell, and then excercise. He said sure. And it was done. But at another broker 6 years ago, i came upon another situation like that, and he gave me a long winded excuse that he can't do that. It is against regulations.
My question is why do some brokers allow selling, and then assigning? And why do some brokers only allow shorting and assigning?
More...

don't you mean could you buy first ("not sell and then exercise."} if you were long puts and exercised that means you sold shares and were short the stock if you did not have stock in the account.
 
Are you saying you want to short a stock but not have the transaction really be a short (i.e. not have to follow the uptick rule)?
 
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