The close out price is 20% above the closing price on t+2 or highest price from the trade date till the date of close. Among this it is higher of the two right?
But i typically get highest price from the trade date till t+2 and not 20% above t+2 close.
Could turn out dangerous for stock buyer if this is a covered call.In case of upmove/ gap up, sold call would be bleeding.Not a fait situation for the buyer.Buyer’s interest definitely not protected it is a trading position with or without sold call against it.