Registered: Oct 2003
Posts: 8344

---

Quote from blueplayer:

I know the thread is 7 years old and this comment was posted about 1 month ago, but just for reference and to stop this line of attack, the official close of Google at 4:00PM that exp day was 280.30. No after hours funny games were involved at all.

---

Registered: Oct 2003
Posts: 8344

---

Quote from tomcole:

YIPES!!!!!!!!!!!!!

Thats a helluva story.

If they moved money from a regular a/c to a IRA a/c, AT WILL & WITHOUT YOUR PERMISSION, that has to be one wild tax question for you.

Is there a legal precednce for this or an IRS opinion? I'd love to see it.

If you're already maxed out how much you can put into IRA type a/cs and move yet even more, whos responsible? Did they move capital, trading profts or what?

You need a lawyer my friend, this is a growing nightmare.

---

Registered: Sep 2004
Posts: 39

I remember having received an email from IB lately addressing this problem - they will now deny exercize of options that might result in a margin deficit:

http://ibkb.interactivebrokers.com/node/1767

IB reserves the right to prohibit the exercise of stock options and/or close short options if the effect of the exercise/assignment would be to place the account in or near margin deficit. While the purchase of an option generally requires no margin since the position is paid in full, once exercised the account holder is obligated to either pay for the ensuing long stock position in full (in the case of a call exercised in a cash account or stock subject to 100% margin) or finance the long/short stock position (in the case of a call/put exercised in a margin account)._ Accounts which do not have sufficient equity on hand prior to exercise introduce undue risk should an adverse price change in the underlying occur upon delivery. This uncollateralized risk can be especially pronounced and may far exceed any in-the-money value the long option may have held, particularly at expiration when clearinghouses automatically exercise options at in-the-money levels as low as $0.01 per share.
Take, for example, an account whose equity on Day 1 consists solely of 20 long $50 strike call options in hypothetical stock XYZ which have closed at expiration at $1 per contract with the underlying at $51. Assume under Scenario 1 that the options are all auto-exercised and XYZ opens at $51 on Day 2. Assume under Scenario 2 that the options are all auto-exercised and XYZ opens at $48 on Day 2.

Advantage Futures

Futures Brokerage & Clearing

AMP Global Clearing

Futures and FX Trading

Bright Trading

Professional Equities Trading

CTS

Futures Trading Software

DaytradingBias.com

Professional Trading Analytics

ECHOtrade

Professional Trading Firm

eSignal

Trading Software Provider

FXCM

Forex Trading Services

Global Futures

Futures, Options & FX Trading

Interactive Brokers

Pro Gateway to World Markets

JC Trading Group

Direct Access Trading

MB Trading

Direct Access Trading

MultiCharts

Trading Software Provider

NinjaTrader

Trading Software Provider

OANDA

Currency Trading

optionshouse

Option Trading & Education

Rithmic

Futures Trade Execution Platform

SpeedTrader

Direct Access Trading

SpreadProfessor

Spread Trading Instruction

thinkorswim by TD Ameritrade

Direct Access Trading

TradersStudio

System Building & Backtesting

Trading Technologies

Trading Software Provider

Trend Following

Trading Systems Provider