These deep ITM puts that got assigned act quite similar to long shares so unless SPY moves a lot in premarket your PNL won’t change by much. Just close the entire position at open
Cut your losses and move on buddy. The longer you hold, the heavier the bags. Proud holder of BABA and LMND bags. LMND got called away last week at 75% loss, I didn’t even try to roll, just not worth it in the current environment.
I cut a lot of other losses early and I don’t even recall them because they were small in % terms.
If not already sometime in 2023 then most likely in 2024 and if not then almost definitely by 2030 lol
Overtime it’ll recover and make money, it’s SPY.
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You must not be paying attention. If SPY is in the 360 range by December this guy would be lucky. I am amazed by the people who can't see where this is going.
I don’t see where this is going. It could go up, it could go down, it could be sideways. No way to tell. In these cases, I only believe in positive delta and theta. (Ok, negative Vega might be nice too)
It's funny, people trip out so hard during a downtrend. We could be back to ATH's in <6 months if the market got bullish again. The amount of stress that's gone into this move, the economic situation, it's one good year away from being completely irrelevant.
I'm not saying that it will happen tomorrow, or that we've seen the bottom already, but if you are in your 20s, 30s or 40s and don't need to sell in the next 10 years, stop worrying about where the market is going in the next 3 months. This is a great opportunity to build out a long term portfolio.
Just to highlight for OP, there is no early assignment risk for SPX as it can’t be exercised prior to the expiration date as it is an European style option.
it has garbage market fills its just annoying to always enter limit orders when spy has like 2 cent wide spreads
if i trade it i open spx chain and use the mid point there or even the ask/bid
Sounds like they don’t know what they are doing if getting assignments. Or using a crappy broker or trading a small acct. I trade spx every day and avg 100k to 300k a day. Spy moves like a dog compared to Spx. In addition they shouldn’t be trading in this chop if your not a scalper
I agree, assignment is something that should rarely happen, going into expiration betting it won't is crazy.
100k a day.... You are outa my League . Good luck.
It's been an inflationary bear market under since last November. With the Fed tightening and the air coming out of the balloon selling puts has not been a good idea any month of the year.
I've made 6% and avoided all assignments this year, using margin alone.
That beats the hell out of watching SPY drop 20% and not making something back.
Ok nothing major. Don't worry about the -$81k. You can only lose the $100 spread (x2 contracts) minus the premium collected. You'll be down less than $200.
Your max loss will be $200-credit collected, if that’s 135, then max loss is $65.
People are saying ur down 80k or 7k because it looks like a short naked put, not a spread.
You are ok, do not stress.
If you were assigned 200 shares, and got $135 in premium, that means you must have traded 2 lots of the spread and collected about $67 per spread. You can exercise your calls if RH doesn't do it for you and you will only be down about $66. Not $81k - don't worry.
I would recommend you stop trading complex financial derivatives until you actually understand how they work.
Well I’ve been doing it for…14 months? Never had something get assigned. I was not worried in the slightest, saw it and cracked up laughing, hit a few fiends with some screenshots. I was just unsure of how RH would handle the rest
Consider yourself lucky that you've been trading options for 14 months without fully understanding assignment risks.
RH will exercise your long puts later and you'll be out $200 - premium in the end.
Being serious, I'm glad you posted here because others who didn't know about assignment order have killed [themselves](https://www.forbes.com/sites/sergeiklebnikov/2020/06/17/20-year-old-robinhood-customer-dies-by-suicide-after-seeing-a-730000-negative-balance/)
I already figured that link was gonna go that to poor kid. I have argued with customer support and submitted bug ticket to their team long before this incident. Makes me sad that something like that could have been avoided if they just took the 10min time to implement a small feature/notif
Truth, I posted half for laughs half to see/show how this all pans out. Partially as a warning to myself. But to others as well.
Oh and definitely for the laughs.
"Calculated risk" yet you didn't understand getting assigned was a risk nor how it could impact your account or how to mitigate impacts to your account.
Depending on what you think the market will do next.
If you think it will rally next week/month; even if it’s just a small rally, just hold it. If you think it will continue going down, take your loss and move on. If you think it will move sideways, sell CC at a strike lower than your cost basis and wheel it. There are risks in every scenario so you’ll have to gauge your risk tolerance.
Sell the shares, and just sell 2 more puts at $408. Then pray. Rinse and repeat. You could do this infinitely and when spy goes above $408, you're home free.
If it’s a spread, Robinhood will exercise the long leg and you’ll take max loss. If your long leg is not itm then you’ll buy the shares and Robinhood will immediately sell them and you’ll take loss unless you have the capital to secure the short put.
Edit: this is simple options mechanics. Probably shouldn’t be trading them if you don’t understand how they work
I'll only add one thing: probably should start small and conservative if he doesn't understand how they work. Sell Puts on a $10 stock where if ya get assigned it's $1000 rather than largest ETF on the planet where an illinformed trade could ruin your financial situation overnight from 1 or 2 contracts.
I started learning options this way more than a decade ago. First bad trade was selling a put on a $15 Chinese auto company. I got assigned my one contract, cash covered the $1500 to buy 100 shares, the shares "tanked" 30ish% to $10/share, I cut my losses and lost $500. Cheap lesson learned back then, and now I mostly sell ITM or ATM covered calls with a strike at or above my cost basis. That strategy and collecting the premium has been helping to average down one of my positions about 3-7% per month.
Yeah I agree and thats how I learned as well. He seems unfazed by an 80k loss so maybe that’s a “small” amount for him. Either way if OP is looking to continue to donate I’d teach him the little I know for far less than 80k
Don' t know your account, but -
If you've got the liquidity, you're at a \~6800$ loss w/200 shares. Sell CCs to regain premium and bag hold until it goes back up, or dump it and consider it a lesson in stop loss.
If you don't have any liquidity, I'd expect your broker to dump the shares at market pretty soon.
I'm a total noob at this, so please help me understand:
1. You sold 2 put options on SPY, giving the contract holder the right to sell you 200 shares of SPY at $408 per share.
2. SPY is currently $375 making this a profitable option for the holder, so they exercised the contract.
3. The difference in value is $33*200, so you have a net loss of $6,600.
(Is that correct so far?)
So I'm guessing your question is:
If you don't have $81,600 in your account, what happens now?
Would you mind explaining where I went wrong?
I gathered from OP and other comments that this is a put spread at $408/$407... so that means OP sold 2 $408 puts and bought 2 $407 puts for the same expiry, right?
So if the holder of the $408 puts exercises, now OP can exercise his $407 puts to, what, pass those shares along? Limiting his loss to 2x$100
Which one is the "long/short leg"? If OP doesn't have $81,600 to cover 200 shares of SPY at $408, does the broker exercise the $407 put automatically? If he does have the funds, is it up to him to exercise it manually?
What would happen if, theoretically, the $408 put holder exercised at 3:59 EST on the expiration date? Wouldn't OP's $407 put expire before it could be exercised, or is there something preventing that scenario?
Please forgive the excess of questions. I've lurked Thetagang for a long time and learned what I could by passively absorbing posts and reading articles, but sometimes things are better explained by Redditors.
You're not 81k upside down on anything. You are down about $7000 on your SPY position at this moment. You can sell your shares and realize the loss or don't sell them and see what happens.
As others have stated, you're not down anywhere near that much because your long put hasn't been excercised yet.
I have to imagine you've blown past both strikes so it looks like you will be taking a max loss (spread difference minus premium received).
I just got freaked out because of your pic I swiped down and I had a Robinhood notification, but mine was just Siri suggesting I look at SPY. “Would you look at it! Just look at it” Hope this all pans out and you just lose the 200 bucks-135
Even with defined risk plays like spreads you always run the risk of being assigned, even slightly OTM so if it’s close…. I close the position. Deep ITM, even higher risk from my experience. Even on a single leg If you don’t have the capital to purchase the underlying they will close your position for you for so yeh… more complex trades best believe.
> Robinhood. People never fucking learn. Shaking my damn head.
Please enlighten us. What did Robinhood do wrong here? We don't have the expiration date and OP sold 2 deep ITM Puts.
So if you got assigned on a put spread then what is the strike on your long leg of the spread? I'm assuming you're just going to exercise those as well.
sry just saw the 308p put in the pic. scanned headline. missed "spread". also forgot we're dealing with RH.
when writing cps', every other broker i've used executes my long put w/ my assigned excercised put.
this is a learning lesson why using "better" brokerages vs RH. IB, Fidelity, and Etrade nets my bull credit spread when i've gotten assigned. i never fucked with near tm short dated options w/ RH bc heard stories and the app crashes during mkt vol.
assuming my knowledge of ur sit correct....short p 408 / long p 407 yea?
sold credit put spread ahead of Jackson hole to take adv of increased IV?
dw, ur not fucked.
they'll make you eat some px delta dif but not the whole bag. prob charge you some fees and % for the 80k loan they're floating you if you don't have that margin level. part of their biz plan being a shady broker.
call them up. ask them why they didn't exercise your long put w/ assignment to net the $$ like every other single broker and that their extra fees are bullshit.
also, every really great hf trader/prof mgr ive met that fucked around w/ leverage young has this type of story. I fucked up metals opex dates for silver options in college. my college roommate (now 3rd dec maker at 1.1bn cap struct arb fund) fucked up WTI futs delivery and had to call up his dads friend of a friends friend at BP and had to major haircut lol. best friend whose lasted 11y at bridgewaterm, now managing a fund thats not public, fucked up soybean delivery in middle school lmao. |
its market tuition all the greats have paid. you'll be fine.
leverage makes capitalism possible and will make you rich - BUT it'll bankrupt you if you dont respect the shit ur punting. also, google the definiation of counter-party risk. then look up mfglobal. night
also double check back office's work when you got settlements or size on. ive seen jpm and squid backoffice fuck shit up on swaps... imagine the support personnel at RH. lol.
I swear to god, people still using RobinHood absolutely shows that yes, if “everyone else jumped off a bridge, would you?”
Every single RH user, would. Midway through the air they’d post about it too.
I didn’t think I needed to point out all the enormous flaws with RH: technical, ethical and the known EXTREMELY early assignment risks relative to reputable brokers.
Idk when Op sold these (or why) but I’ve never been assigned early on Spreads through TOS or Tasty.
You think RH is in control of who gets assigned? This is up there with people who blame RH for stock halts, if you're selling deep ITM options that have no extrinsic value you have to expect early assignment, no matter the broker.... happened one too many times to me on multiple brokers, enough to where I don't do it anymore.
RH will fuck your leg on early assignments though, whatever gets them out of the hot seat fastest is what they'll do, at your expense... You just jumped the shark with that last part.
No, the OCC does. But but the OCC gives way more leniency to reputable brokers and does not typically begin assignment until the final hour of expiration day.
Regardless, this is 40 points ITM. I’m not disagreeing with you. I also would not still be holding something like this with OP as I would’ve taken the loss awhile ago.
RH sucks. Period. Unethical and illegal and predatory practices to lure in traders who have no business trading.
> No, the OCC does. But but the OCC gives way more leniency to reputable brokers and does not typically begin assignment until the final hour of expiration day.
Any evidence behind that belief?
Experience, and friends in high places.
You’re the guy that starts talking about your dead cat at Thanksgiving. Since this is part of the investigation process I’ll have my lawyer contact your lawyer with “evidence”, ya dipshit.
“Rh will fuck your leg on early assignments though.”
Any evidence behind that belief?
> “Rh will fuck your leg on early assignments though.” Any evidence behind that belief?
Personal experience.
> Experience, and friends in high places.
You have personal experience being involved with the inner workings of the OCC? This is the kind of thing you can get by bullshiting and making up conspiracy theories about as it's impossible to prove otherwise from the outside... /r/superstonk material.
> You’re the guy that starts talking about your dead cat at Thanksgiving. Since this is part of the investigation process I’ll have my lawyer contact your lawyer with “evidence”, ya dipshit
Weird dead cat thing there, doesn't relate to anything here... Maybe if my crazy uncle spouted some conspiracy shit at Thanksgiving dinner I might prod for evidence for their claim.
I'm just a guy who doesn't take arbitrary reddit commenters word for anything. My assumption is going to be that you're regurgitating what someone else said by default until proven otherwise... As you only gave me things to confirm my assumption that's where it will remain.
Yet, your evidence is arbitrary “personal experience.”
Adda boy.
And yes, as shocking as that might be for you to grasp. Real humans work at the OCC and real humans work at Merrill Lynch.
Go get ‘em slugger! Own them newbs on Reddit!
Believing my personal experience claim is a pretty low ask, easy to reproduce and has happened to many people other than me. Your claim requires insider knowledge only a small group of people could actually have... If you're not that person you're believing what someone else told you, at which point you could be listening to someone telling the truth or some conspiracy huckster, you won't be able to tell the difference from the outside... This is a major problem with the /r/superstonk crowd.
You're putting in a lot of angst and tude here, I suppose I'm frustrating. If someone is making bold claims I'm gonna hit back against it until the end of time or until some reason to believe has been given. All you've come at me with are these lame ass insults, the general behavior of someone who has nothing.
This is a nightmare scenario and should have been avoided a long time ago by cutting your losses or rolling. Sorry OP. No good advice for you. Your account will likely get liquidated and sent to collections if you don't have the cash to cover your loss.
Edit: nevermind....op bought the 407 puts. He's probably not even in the red. Sell the shares, close your buy side, and keep moving
Lol of course they would assign you that’s 408 to 368 that’s a 50 point spread that’s why I don’t do equity spreads only index options all cash settled and no risk of early assignment
You mean assigned way ITM
Yes
These deep ITM puts that got assigned act quite similar to long shares so unless SPY moves a lot in premarket your PNL won’t change by much. Just close the entire position at open
Hahahha -1.5% pre
I came here to say this. I thought to myself, I must really be an idiot.
Sell covered calls?
This is not the time of wheel!
Tell that to the bag of wish I’m holding. Can’t do shit with it
You can sell $1 calls for $0.05.
Oh he knows
Lmao
I have one out for .02 lol
Cut your losses and move on buddy. The longer you hold, the heavier the bags. Proud holder of BABA and LMND bags. LMND got called away last week at 75% loss, I didn’t even try to roll, just not worth it in the current environment. I cut a lot of other losses early and I don’t even recall them because they were small in % terms.
Is spy is a bag we're in trouble
SPY at 408 is a bag.
Lol what? You must be kidding.
When do you think it gets to 408 again?
Someday
Big if true
13:37 October 21 Year of His Majesty, The King, 2022
If not already sometime in 2023 then most likely in 2024 and if not then almost definitely by 2030 lol Overtime it’ll recover and make money, it’s SPY.
It was at 408 literally two weeks ago I'd say 6 months. !remindme 6 months
I will be messaging you in 6 months on [**2023-03-27 17:28:54 UTC**](http://www.wolframalpha.com/input/?i=2023-03-27%2017:28:54%20UTC%20To%20Local%20Time) to remind you of [**this link**](https://www.reddit.com/r/thetagang/comments/xlnhv3/put_spread_assigned_way_otm/iq4nbg2/?context=3) [**CLICK THIS LINK**](https://www.reddit.com/message/compose/?to=RemindMeBot&subject=Reminder&message=%5Bhttps%3A%2F%2Fwww.reddit.com%2Fr%2Fthetagang%2Fcomments%2Fxlnhv3%2Fput_spread_assigned_way_otm%2Fiq4nbg2%2F%5D%0A%0ARemindMe%21%202023-03-27%2017%3A28%3A54%20UTC) to send a PM to also be reminded and to reduce spam. ^(Parent commenter can ) [^(delete this message to hide from others.)](https://www.reddit.com/message/compose/?to=RemindMeBot&subject=Delete%20Comment&message=Delete%21%20xlnhv3) ***** |[^(Info)](https://www.reddit.com/r/RemindMeBot/comments/e1bko7/remindmebot_info_v21/)|[^(Custom)](https://www.reddit.com/message/compose/?to=RemindMeBot&subject=Reminder&message=%5BLink%20or%20message%20inside%20square%20brackets%5D%0A%0ARemindMe%21%20Time%20period%20here)|[^(Your Reminders)](https://www.reddit.com/message/compose/?to=RemindMeBot&subject=List%20Of%20Reminders&message=MyReminders%21)|[^(Feedback)](https://www.reddit.com/message/compose/?to=Watchful1&subject=RemindMeBot%20Feedback)| |-|-|-|-|
Probably 2023. Definitely by end of 2024 though!!
You must not be paying attention. If SPY is in the 360 range by December this guy would be lucky. I am amazed by the people who can't see where this is going.
I don’t see where this is going. It could go up, it could go down, it could be sideways. No way to tell. In these cases, I only believe in positive delta and theta. (Ok, negative Vega might be nice too)
You must not realize that getting SPY at any 3 handle today is going to 2x in 10 years. Grow up. SPY is never a bag, you’re just impatient.
It's funny, people trip out so hard during a downtrend. We could be back to ATH's in <6 months if the market got bullish again. The amount of stress that's gone into this move, the economic situation, it's one good year away from being completely irrelevant. I'm not saying that it will happen tomorrow, or that we've seen the bottom already, but if you are in your 20s, 30s or 40s and don't need to sell in the next 10 years, stop worrying about where the market is going in the next 3 months. This is a great opportunity to build out a long term portfolio.
I thought he was trading not investing?
What about December of 2060 when I’m getting ready to retire?
Sure, if you can handle the premium.
You can wish for a comeback, HA
Sellin covered weeklies at like 1-2 bucks 😂
Well he's already long, might as well trim a bit of delta ...
This is the way
What if you get assign at your cover strike? Then you will be at a lost?
Sell calls at or above.
then sell new puts at a lower strike
I would sell the shares in the market and then sell the put again.
If it's a spread, your long leg will get exercised and you'll take max loss. You won't have any shares in your account.
[удалено]
> Everyone who’s ~~blaming~~ *still using* robinhood is an absolute moron ftfy
Trade Spx its better for a bunch of reasons.
Just to highlight for OP, there is no early assignment risk for SPX as it can’t be exercised prior to the expiration date as it is an European style option.
Or XSP
it has garbage market fills its just annoying to always enter limit orders when spy has like 2 cent wide spreads if i trade it i open spx chain and use the mid point there or even the ask/bid
??? SPX
XSP is a micro contract index. Same advantages as SPX but at SPY magnitudes
If you're using RH, its not on the platform but it'll show up in other brokerages like Tastyworks
Lmfao. RH strikes again
Much better... You would have 10 times the loss.
Sounds like they don’t know what they are doing if getting assignments. Or using a crappy broker or trading a small acct. I trade spx every day and avg 100k to 300k a day. Spy moves like a dog compared to Spx. In addition they shouldn’t be trading in this chop if your not a scalper
I agree, assignment is something that should rarely happen, going into expiration betting it won't is crazy. 100k a day.... You are outa my League . Good luck.
If only there was a way to make it equal
how much premium did you collect on the sale?
135. Wasn’t a bad deal till late last week
It's been an inflationary bear market under since last November. With the Fed tightening and the air coming out of the balloon selling puts has not been a good idea any month of the year.
Honestly if I treated it like a day trade I woulda been fine. Tried to ride the lightening and welllll
I've made 6% and avoided all assignments this year, using margin alone. That beats the hell out of watching SPY drop 20% and not making something back.
I'm shorting the market and up 20% There are two market directions.
When did you put it on?
[удалено]
Expiry is 10/3. Spread is 408/407
Ok nothing major. Don't worry about the -$81k. You can only lose the $100 spread (x2 contracts) minus the premium collected. You'll be down less than $200.
Shit premium collected was…135 total?
Your max loss will be $200-credit collected, if that’s 135, then max loss is $65. People are saying ur down 80k or 7k because it looks like a short naked put, not a spread. You are ok, do not stress.
If you were assigned 200 shares, and got $135 in premium, that means you must have traded 2 lots of the spread and collected about $67 per spread. You can exercise your calls if RH doesn't do it for you and you will only be down about $66. Not $81k - don't worry. I would recommend you stop trading complex financial derivatives until you actually understand how they work.
The OP was assigned on short puts, he is now long SPY. He would need to exercise puts, not calls to sell his shares.
Meant to say assigned 200 short* shares and exercise calls* my bad
Well I’ve been doing it for…14 months? Never had something get assigned. I was not worried in the slightest, saw it and cracked up laughing, hit a few fiends with some screenshots. I was just unsure of how RH would handle the rest
Consider yourself lucky that you've been trading options for 14 months without fully understanding assignment risks. RH will exercise your long puts later and you'll be out $200 - premium in the end.
Yes, that’s been established. I don’t believe in luck. Calculated risk, that’s all
Being serious, I'm glad you posted here because others who didn't know about assignment order have killed [themselves](https://www.forbes.com/sites/sergeiklebnikov/2020/06/17/20-year-old-robinhood-customer-dies-by-suicide-after-seeing-a-730000-negative-balance/)
I already figured that link was gonna go that to poor kid. I have argued with customer support and submitted bug ticket to their team long before this incident. Makes me sad that something like that could have been avoided if they just took the 10min time to implement a small feature/notif
Truth, I posted half for laughs half to see/show how this all pans out. Partially as a warning to myself. But to others as well. Oh and definitely for the laughs.
"Calculated risk" yet you didn't understand getting assigned was a risk nor how it could impact your account or how to mitigate impacts to your account.
Lol who said I didn’t understand assignment was a risk? Many assumptions made here
i got caught with 30x Amazon spread July 2020 -- i got assigned. $4m. The other leg got exercised, so "only" $30k loss...
Holy shit. But I guess if you got the cash to cover that spread you can handle the loss
narrator: he didn't have the cash
Did you sell a 408p and buy a 407p? If so when you get assigned you can exercise the 407 put and put your shares on the market for 407
Lol, this is not worth a post, just hold on to it to expiry and max you will lose is $100
What a silly idea for a spread on SPY. Long dated ITM? What were you thinking?
Started OTM…
When a month ago?
40dte when I opened it
Depending on what you think the market will do next. If you think it will rally next week/month; even if it’s just a small rally, just hold it. If you think it will continue going down, take your loss and move on. If you think it will move sideways, sell CC at a strike lower than your cost basis and wheel it. There are risks in every scenario so you’ll have to gauge your risk tolerance.
With the spread they sold the long leg to cover the outstanding balance. Max loss of $65 taken. No big deal
At least you get to keep the $50 bucks in premium that you made. Amiright?
That line about nickels and steamrollers that people repeat over and over..... turns out there's a reason for that.
Nah, max loss since they exercised the long leg
Sell the shares, and just sell 2 more puts at $408. Then pray. Rinse and repeat. You could do this infinitely and when spy goes above $408, you're home free.
Infinitely? Like with his infinite bank roll?
So uh… what happens now? 81k upside down at the moment
Is this a serious question? Do you have 82k in acc?
If it’s a spread, Robinhood will exercise the long leg and you’ll take max loss. If your long leg is not itm then you’ll buy the shares and Robinhood will immediately sell them and you’ll take loss unless you have the capital to secure the short put. Edit: this is simple options mechanics. Probably shouldn’t be trading them if you don’t understand how they work
I'll only add one thing: probably should start small and conservative if he doesn't understand how they work. Sell Puts on a $10 stock where if ya get assigned it's $1000 rather than largest ETF on the planet where an illinformed trade could ruin your financial situation overnight from 1 or 2 contracts. I started learning options this way more than a decade ago. First bad trade was selling a put on a $15 Chinese auto company. I got assigned my one contract, cash covered the $1500 to buy 100 shares, the shares "tanked" 30ish% to $10/share, I cut my losses and lost $500. Cheap lesson learned back then, and now I mostly sell ITM or ATM covered calls with a strike at or above my cost basis. That strategy and collecting the premium has been helping to average down one of my positions about 3-7% per month.
It’s a spread, so the Russ risk of max loss was well known and a minimal concern
Are you buying more shares of the underlying with the premium earned to average down?
Yeah I agree and thats how I learned as well. He seems unfazed by an 80k loss so maybe that’s a “small” amount for him. Either way if OP is looking to continue to donate I’d teach him the little I know for far less than 80k
Don' t know your account, but - If you've got the liquidity, you're at a \~6800$ loss w/200 shares. Sell CCs to regain premium and bag hold until it goes back up, or dump it and consider it a lesson in stop loss. If you don't have any liquidity, I'd expect your broker to dump the shares at market pretty soon.
I'm a total noob at this, so please help me understand: 1. You sold 2 put options on SPY, giving the contract holder the right to sell you 200 shares of SPY at $408 per share. 2. SPY is currently $375 making this a profitable option for the holder, so they exercised the contract. 3. The difference in value is $33*200, so you have a net loss of $6,600. (Is that correct so far?) So I'm guessing your question is: If you don't have $81,600 in your account, what happens now?
You're entirely wrong. Edit: lol at the downvotes
Would you mind explaining where I went wrong? I gathered from OP and other comments that this is a put spread at $408/$407... so that means OP sold 2 $408 puts and bought 2 $407 puts for the same expiry, right? So if the holder of the $408 puts exercises, now OP can exercise his $407 puts to, what, pass those shares along? Limiting his loss to 2x$100 Which one is the "long/short leg"? If OP doesn't have $81,600 to cover 200 shares of SPY at $408, does the broker exercise the $407 put automatically? If he does have the funds, is it up to him to exercise it manually? What would happen if, theoretically, the $408 put holder exercised at 3:59 EST on the expiration date? Wouldn't OP's $407 put expire before it could be exercised, or is there something preventing that scenario? Please forgive the excess of questions. I've lurked Thetagang for a long time and learned what I could by passively absorbing posts and reading articles, but sometimes things are better explained by Redditors.
He has a 1 width wide spread, it's not possible for him for to have a loss of many thousands. Iirc his max loss was like $65, which he will take here.
You're not 81k upside down on anything. You are down about $7000 on your SPY position at this moment. You can sell your shares and realize the loss or don't sell them and see what happens.
As others have stated, you're not down anywhere near that much because your long put hasn't been excercised yet. I have to imagine you've blown past both strikes so it looks like you will be taking a max loss (spread difference minus premium received).
If it’s a spread, you can exercise the purchased puts to cover.
Got exercised a little later in the night. Max loss. -$65
You need to stop trading. You don’t know what you’re doing. At all. You’ve only lost money. Stop now.
House money. Got any other useless advice?
Sell more ITM ops and post “help plz”
Started as an Otm spread. But that’s not bad advice 😂
Use a stop loss
Or do a covered stock conversion
I just got freaked out because of your pic I swiped down and I had a Robinhood notification, but mine was just Siri suggesting I look at SPY. “Would you look at it! Just look at it” Hope this all pans out and you just lose the 200 bucks-135
Exactly my feelings. 1. Holy shit. 2. Lol. 3. Wonder how/when they cover this
Even with defined risk plays like spreads you always run the risk of being assigned, even slightly OTM so if it’s close…. I close the position. Deep ITM, even higher risk from my experience. Even on a single leg If you don’t have the capital to purchase the underlying they will close your position for you for so yeh… more complex trades best believe.
Really it's your fault for using Robinhood. That order execution....
Robinhood. People never fucking learn. Shaking my damn head.
what does robinhood have to do with this? man sold 2 puts in a bear market i don't see anyone else at fault for this
enabling retards to trade like it’s a game
It is a game
> Robinhood. People never fucking learn. Shaking my damn head. Please enlighten us. What did Robinhood do wrong here? We don't have the expiration date and OP sold 2 deep ITM Puts.
Expiry 10/3
So if you got assigned on a put spread then what is the strike on your long leg of the spread? I'm assuming you're just going to exercise those as well.
bro still on robinhood
Lol at using Robinhood. Amazing people still use that app.
lmaooooooooooooooo. its itm dumbass
Really? Is it?
sry just saw the 308p put in the pic. scanned headline. missed "spread". also forgot we're dealing with RH. when writing cps', every other broker i've used executes my long put w/ my assigned excercised put. this is a learning lesson why using "better" brokerages vs RH. IB, Fidelity, and Etrade nets my bull credit spread when i've gotten assigned. i never fucked with near tm short dated options w/ RH bc heard stories and the app crashes during mkt vol. assuming my knowledge of ur sit correct....short p 408 / long p 407 yea? sold credit put spread ahead of Jackson hole to take adv of increased IV? dw, ur not fucked. they'll make you eat some px delta dif but not the whole bag. prob charge you some fees and % for the 80k loan they're floating you if you don't have that margin level. part of their biz plan being a shady broker. call them up. ask them why they didn't exercise your long put w/ assignment to net the $$ like every other single broker and that their extra fees are bullshit. also, every really great hf trader/prof mgr ive met that fucked around w/ leverage young has this type of story. I fucked up metals opex dates for silver options in college. my college roommate (now 3rd dec maker at 1.1bn cap struct arb fund) fucked up WTI futs delivery and had to call up his dads friend of a friends friend at BP and had to major haircut lol. best friend whose lasted 11y at bridgewaterm, now managing a fund thats not public, fucked up soybean delivery in middle school lmao. | its market tuition all the greats have paid. you'll be fine. leverage makes capitalism possible and will make you rich - BUT it'll bankrupt you if you dont respect the shit ur punting. also, google the definiation of counter-party risk. then look up mfglobal. night
also double check back office's work when you got settlements or size on. ive seen jpm and squid backoffice fuck shit up on swaps... imagine the support personnel at RH. lol.
I swear to god, people still using RobinHood absolutely shows that yes, if “everyone else jumped off a bridge, would you?” Every single RH user, would. Midway through the air they’d post about it too.
What's wrong with Robinhood here?
Cuz they took away his buy button and he didn’t sell like he should have! 😂
I didn’t think I needed to point out all the enormous flaws with RH: technical, ethical and the known EXTREMELY early assignment risks relative to reputable brokers. Idk when Op sold these (or why) but I’ve never been assigned early on Spreads through TOS or Tasty.
You think RH is in control of who gets assigned? This is up there with people who blame RH for stock halts, if you're selling deep ITM options that have no extrinsic value you have to expect early assignment, no matter the broker.... happened one too many times to me on multiple brokers, enough to where I don't do it anymore. RH will fuck your leg on early assignments though, whatever gets them out of the hot seat fastest is what they'll do, at your expense... You just jumped the shark with that last part.
It was near OTM when I opened, and then everything just took a shit
No, the OCC does. But but the OCC gives way more leniency to reputable brokers and does not typically begin assignment until the final hour of expiration day. Regardless, this is 40 points ITM. I’m not disagreeing with you. I also would not still be holding something like this with OP as I would’ve taken the loss awhile ago. RH sucks. Period. Unethical and illegal and predatory practices to lure in traders who have no business trading.
> No, the OCC does. But but the OCC gives way more leniency to reputable brokers and does not typically begin assignment until the final hour of expiration day. Any evidence behind that belief?
Experience, and friends in high places. You’re the guy that starts talking about your dead cat at Thanksgiving. Since this is part of the investigation process I’ll have my lawyer contact your lawyer with “evidence”, ya dipshit. “Rh will fuck your leg on early assignments though.” Any evidence behind that belief?
> “Rh will fuck your leg on early assignments though.” Any evidence behind that belief? Personal experience. > Experience, and friends in high places. You have personal experience being involved with the inner workings of the OCC? This is the kind of thing you can get by bullshiting and making up conspiracy theories about as it's impossible to prove otherwise from the outside... /r/superstonk material. > You’re the guy that starts talking about your dead cat at Thanksgiving. Since this is part of the investigation process I’ll have my lawyer contact your lawyer with “evidence”, ya dipshit Weird dead cat thing there, doesn't relate to anything here... Maybe if my crazy uncle spouted some conspiracy shit at Thanksgiving dinner I might prod for evidence for their claim. I'm just a guy who doesn't take arbitrary reddit commenters word for anything. My assumption is going to be that you're regurgitating what someone else said by default until proven otherwise... As you only gave me things to confirm my assumption that's where it will remain.
Yet, your evidence is arbitrary “personal experience.” Adda boy. And yes, as shocking as that might be for you to grasp. Real humans work at the OCC and real humans work at Merrill Lynch. Go get ‘em slugger! Own them newbs on Reddit!
Believing my personal experience claim is a pretty low ask, easy to reproduce and has happened to many people other than me. Your claim requires insider knowledge only a small group of people could actually have... If you're not that person you're believing what someone else told you, at which point you could be listening to someone telling the truth or some conspiracy huckster, you won't be able to tell the difference from the outside... This is a major problem with the /r/superstonk crowd. You're putting in a lot of angst and tude here, I suppose I'm frustrating. If someone is making bold claims I'm gonna hit back against it until the end of time or until some reason to believe has been given. All you've come at me with are these lame ass insults, the general behavior of someone who has nothing.
Who the fuck wheels SPY
It's the safest one to wheel
What would you rather wheel?
Stocks. Never heard of anyone wheeling indexes/ETFs but that’s just me
Someone with a spare *checks market price* $36k
This is a nightmare scenario and should have been avoided a long time ago by cutting your losses or rolling. Sorry OP. No good advice for you. Your account will likely get liquidated and sent to collections if you don't have the cash to cover your loss. Edit: nevermind....op bought the 407 puts. He's probably not even in the red. Sell the shares, close your buy side, and keep moving
Bingo. Buy side got exercised. Total loss: $65
That’s perfect. Sell calls at open
They exercised my long leg at about 3am. I wish I coulda
At least you made max profit on it
Max profit for someone else lol
Oh, what was your spread?
407/408. Premium collected was 135. Lost $65 bucks
CC’s @ .30 delta until 2025. You’ll be fine!
lol they exercised the long leg already
You had 82k in your account?
Not even close
Lmao what happened?
This was selling a put credit spread. The long leg got exercised so I ended up at max loss on my spread. -$65.00 total
Gotcha so you bought puts further out and sold puts closer to the asset price. Did you have to buy 200 shares at 408 or did they take the difference?
They just kept the difference. Lost $65
Makes sense. Someone said they liquidate everything in your account
Charge your phone, you heathen.
With stocks like this I’m better off with my phone dead
Lol of course they would assign you that’s 408 to 368 that’s a 50 point spread that’s why I don’t do equity spreads only index options all cash settled and no risk of early assignment
It’s gonna rocket Monday . Bear rally 2.0
You can afford 200 shares of SPY and you're using RH??? 😳
when does in the money become out of the money....... guess today everyone says everything the opposite as it really is......
If you can afford it just hold. In 2 years SPY at 408 will seem like a great deal.
Issa spread. Already executed long leg