Suppose the following: You're short ITM calls, or alternatively, Long ITM puts. And that the underlying is either; De-Listed from the exchange, or, Trading (of the underlying) has been suspended... - What's the result? - Anyone got previous experience of this event? Also interested in the outcome of the same event when you've shorted a security - either naked or on loan to you. Note: Already searched "Characteristics and Risks of Standardized Options and Supplements.pdf" with keywords; 'suspended", "de-listed' and "delisted"... 0 hits
It's an option contract. If you're long, you have the right to exercise, If short, you have the obligation of assignment. You are not excused from gains or losses due to corporate events. If the UL is suspended from trading, everything goes on hold until the issues are resolved and trading resumes. If the UL is delisted, it still trades, often the pink sheets. Being short crashed delisted stock is a wonderful thing. You buy probably near worthless wallpaper to close and you pocket a nice gain.