Little confused about expiration

Discussion in 'Options' started by mynd66, Mar 22, 2009.

  1. johnnyc

    johnnyc

    a lot of places wouldn't let you put on this trade without an account value of at least $2k (minimum for margin). But if you could put it on and it's close to 105 you should probably either close the position out or inform your broker that you will exercise the 105 because some will not let you carry the risk over the weekend, especially if your account value is only $500
     
    #11     Mar 23, 2009

  2. sorry. i miswrote , I had put a limit of 4.
    but AZO was hovering at 159.80-90 range. when they pulled the plug on it.
     
    #12     Mar 23, 2009
  3. Did they at least have the smarts to cancel your bid when they closed the position for you?

    Mark
     
    #13     Mar 23, 2009
  4. heech

    heech

    I personally am of the opinion no broker would let you open this position with that margin positon.

    I haven't shopped around every broker, but at least on IB, Fidelity, and TDA... their margin requirements would preclude you from placing the order in the first place.

    On TDA/IB, I know that when I *cover* a naked call by buying the underlying stocks... my margin maintenance amount actually goes *down*. (Yes, by buying stock, I actually dropped my margin amount.)
     
    #14     Mar 23, 2009
  5. johnnyc

    johnnyc

    the same will happen if you buy a call to turn it into a spread rather than a naked call
     
    #15     Mar 23, 2009