getting into options,so learning lets say, I have 60 short put contracts and been chosen for assignment, will it be for all 60 or any partial assignment depending on the counterparty
1) You be assigned on any quantity between 1 and 60. 2) Accounts are selected at random for assignment notices. The assignments are handed out at the same time. Once your account has been selected (for that specific option on that specific day), your account continues to be assigned - if there are are remaining exercises - until it's cleaned out (all 60). Then another account is chosen for the next assignments. ETC. there are more details, but that should answer the question. Mark
Can be partial or full I think. It really depends and you can't know in advance. Be carefull on dividends. But if one has an advantage to exercise maybe many do...
All xflat said was that if the stock is below the strike price at expiration, you can anticipate being assigned on all 60 puts. Mark
tnx guys, wonder what the percentage is of contracts being exercised in the money with lots of time left, not at expiration. have some covered calls in the money(wft @12.5, stock at 18.50, and mgm @10, stock at 11.50) waiting for them to be exercised so i can put the money to use and had some short puts ( mgm @2.5) that was in the money for a a short time and wished it was exercised
Forget about early assignment if there is no dividend involved. Sure it can happen, but wishing for an option to be assigned when 'there is plenty of time remaining' and it's slightly in the money, demonstrates a certain lack of understanding of how options work. You cannot expect option owners to be stupid. But what you can do is attempt to exit the positions so you can put the money to use. Mark