No if it's a cash account, you won't be allowed to trade options period. The OP has created multiple threads before arguing why options cannot be traded in cash accounts saying it's not efficient and even accused brokers of discrimination and blah blah blah. LOL I have already explained to him many times why and he's still creating this useless thread. The guy (I am sure it's a guy) is a stupid stubborn idiot.
You can trade options in a cash account, Basic Calls and Puts. Directional bets. You can't do any of those more complex strategies, though, and premium selling. TheDawn is confused what she is talking about.
This happened to me years ago in my IRA account. Was long a put that I thought expired OTM (but the buyer exercised after hours on Friday cause the stock dipped below the strike...). On Monday morning I had a decently large short stock position in my Roth (whoops!). The broker called and emailed me to cover the short, which I quickly did. They would have covered it for me at the open if I did nothing, so at least they gave me the courtesy to let me close pre-market!
No you can trade cash-secured options so that everything is covered by the amount of cash in your account and not use any margin but the account has to be a margin account and cannot be a cash account because you won't be allowed to be in naked short positions in the underlying. No broker is going to allow shorting in a cash account because that's major counter-party risk to the broker. When you are in naked short in an underlying, you need extra margin in your account for the short position because of the possible short-squeeze. That's why I say no brokers would allow options trading in a cash account. If some brokers really do allow options trading in a cash account, they might put restrictions on it like no puts like what Robinhood does and the OP created a thread just to bitch about that. Like I said the OP has created multiple threads before bitching about how options trading is not allowed in cash accounts now he's finding out why.
This does not make sense. If you were long a put, you would've been the buyer and nobody would be able to exercise the put against you let alone move the market. Did this situation really happen or did you just make this shit up in order to prove the point made by the OP and the trolls here? And in this situation, you are very lucky (actually to your detriment) that the broker allowed you to have the short position over the weekend because that's a huge counterparty risk to the broker. What if the underlying's price all of sudden goes up over the weekend that landed you in a bad short-squeeze that requires more cash than you have in your IRA account can cover? And since you can't borrow money in a Roth IRA, in this case you would've had to fork over more money to cover. IB in this case, would've closed that short right away on Friday AH if you didn't do it. It wouldn't wait until the open on Monday morning to do something.
Indeed. This is why I stay out options, because of people like that who claim what was claimed. How do you, as a buyer of a put, get exercised on your put that someone else bought? Logic error!
In OP's case, since he is unable to be short shares...more than likely the broker will just liquidate the position prior to expiry.
That is not my problem. This is what I do not understand... "Was long a put that I thought expired OTM..." K, so the put option you bought was ITM then... (but the buyer exercised after hours on Friday cause the stock dipped below the strike...). He was the buyer! What is he talking about? Does he mean the seller that sold him the put?