Hello, this is going to be a total beginner question, so I would appreciate a hint if this is the wrong place to ask (maybe with a pointer to the correct place). I am using TOS thinkback to get an understanding about how options are working. I was looking into how short puts behave, when the underlying performs a sudden drop. I was expecting that in that situation I would be assigned, but instead thinkback is telling me, that I made profit. Sold OTM 13p 08/28 on 08/21 (S). On 08/24 thinkback reports O: 12.24, H: 13.48, L: 10.44, C: 13.19. Still thinkback reports that my put expires on 08/28 (E) and I make 50 profit. Am I missing something here? Is it correct, that I could have been assigned on 08/24? Many thanks, Kono
i dont think it calculates at all after the option has expired, i used to use it back then,, but you can easily calculate your put by checking the underlying price on expiration day, why are you using think back for that any ways??
Actually it does calculate the profit after the option has expired and shows it as line in the chart. I disabled it in the view. I am using thinkback, because it was the first tool I found, that is free and has historic data for a quite long period. But I am happy to try different tools. What would you recommend for back testing option trading? I have read that thinkback only takes the closing value into consideration. My guess is, that since the underlying closed above the strike on 08/24 the contract was not executed. But for clarification: the one that bought the put from me could have executed when the underlying was @ 10.44, couldn't he?
Thinkback is great but what i am saying in the case of what your trying to caluclate you can simply do it by getting the closing price on the day of expiration