Timing and uncertainty
Early assignment risk: what it means
Some contracts can be exercised before expiration, so a short writer can face assignment before the printed date.
Review
- Whether the contract permits early exercise.
- Upcoming events that may change incentives.
- Whether the account can handle shares, cash, or risk.
- Broker notifications and deadlines.
Example
A short call may be assigned during active trading. A probability estimate is not a guarantee.
Primary reading: OIC exercise and assignment overview · SEC Investor Bulletin · FINRA assignment guide
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