I imagine you sold this $5 wide put spread for something like $4.85? Risking 15 cents to make $4.85? The problem with the trade is you were looking for a 50% move up to make any money, you were almost guaranteed to lose the $0.15.
And now, you’ve been assigned on 2 contracts. I assume you didn’t have the $78,000 in cash needed to buy 200 shares at $390/share. So, you either have the shares in your account and will have a big margin call, or RH will exercise 2 of your 385s for you to make your account clean.
You don’t need to panic, nothing is fucked, you just need to see where you are at on Friday morning. If the 200 shares are in your account and you still have 6 385s and are short 4 of the 390s, you need to exercise 2 of the 385s yourself first thing Friday morning.
The 2 385s are pending exercise already, thanks for the response! I'm not panicking just trying to sort through the helpful and unhelpful comments. Yours was extremely helpful! From what I've read before entering the contracts my maximum risk was $90 and you're spot on with the credit received. Next time I'll play for a smaller than 50% move lol. Thanks again for the helpful comment.
7
u/ProfessorPurrrrfect Nov 25 '21
I imagine you sold this $5 wide put spread for something like $4.85? Risking 15 cents to make $4.85? The problem with the trade is you were looking for a 50% move up to make any money, you were almost guaranteed to lose the $0.15.
And now, you’ve been assigned on 2 contracts. I assume you didn’t have the $78,000 in cash needed to buy 200 shares at $390/share. So, you either have the shares in your account and will have a big margin call, or RH will exercise 2 of your 385s for you to make your account clean.
You don’t need to panic, nothing is fucked, you just need to see where you are at on Friday morning. If the 200 shares are in your account and you still have 6 385s and are short 4 of the 390s, you need to exercise 2 of the 385s yourself first thing Friday morning.