I have a few questions and need clarification for the same. I tried to get it first from toll free number 080 4040 2020, but they sent me here. So here it is…
( all questions are from option writers perspective & for equity section -“american settlement”)
- What if my naked short put option gets exercised and i don’t have enough capital to cover it? Does my balance go negative & does stock show up in my account next day?
2.When should i expect margin call, is it before assignment or after assignment? How many days do i have left to pour capital in account after receiving margin call?
3.How could i get out of this position without any additional capital?
4.Same questions but for naked short call option?
5.If I had credit spreads in the questions asked above would it affect outcomes differently?
6.Does assignment happen very often? How likely to get assigned if I am short OTM?