Recently I received an interesting email from an investor, David who posed questions about why his deep in the money calls were going unassigned.

Let’s review his questions and look at the answers I was able to provide.

Investor Questions:

Hi Teddi I was reading one of your articles today about selling in the money calls if assigned a short put.

This is generally what I do as well.

However I find it very difficult and rare to have even deep in the money calls assigned. Which is what I want, to free capital to sell more puts.

In the money puts however I find much more frequently assigned to me.

Even when there are dividends, very deep in money, and or the last day before expiration do I see my stock assigned away on the deep in the money calls.

So I end up rolling further out and up at expiry, and just sell when I’ve rolled as far as I could and hit 100 delta.

Any insight on this?

I have deep in the money TGT, FB, PANW, MCD,TLT, QCOM, DIS….

All held for month deep in the money and not assigned away.

David

Some Answers:

What David has experienced is common and for those of us who sell options for income, it can be used to our advantage. Let’s review his questions and look at some answers but also expand upon this topic as it pertains to rolling in the money option positions to avoid assignment.

  This strategy discussion article is for FullyInformed Members.

 Investor Questions – Understanding Assignment Of In The Money Options

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