So I am looking to sell a few spreads. I was wondering if someone could give some insight on these basic questions. I am using ToS. 1) How much will I be called for? The new ask on the put contracts I sold or my loss on purchasing the stock and selling at the strike? 2) Is it feasibly possible for the put options I sold to be assigned before expiration day? Again, I am selling puts, and there is not a lot of volume or OI on these contracts. Not sure if that makes any difference. Looking forward to your replies. I have been doing a lot of research and think that the next best step to take is to start small and put on a live trade.
1- For verticals, max loss is diff in strikes less premium received 2- Early assignment is possible but unlikely unless deep ITM and no time prem remaining in short strike/ volume and OI makes no difference.
If you have the TOS platform, I'd recommend trading a few spreads in papermoney first just to get comfortable with the mechanics. Also, have a look at the following, which might answer more of your questions. http://www.success-with-options.com/vertical-spread.html The full answer to your questions depends on what kind of spread you enter. Short vertical spreads behave a little differently from long vertical spreads, which are also different from calendar spreads. Mark _________________________ http:/www.success-with-options.com