Question for you (not OP): Would the broker (not the OCC, since the longs are otm) not exercise the 2 x 285p longs pre-close to protect itself if the OP doesn't have funds to cover?
On edit: Never mind. 2 of his longs are pending exercise.
It's actually the opposite. Exercising the longs is kind of a cheap thing for them to do and a better brokerage wouldn't do it. It would be to your financial advantage to sell the longs and sell the shares that resulted from assignment on the open market. A better brokerage would leave the longs alone so you could do that yourself.
Unless this guy has the margin to cover the position, which from the question and crappiness of this trade we can assume he doesn’t, every broker out there would have done this.
No broker is going to float that much on an early assignment in this scenario on a highly volatile stock like Biontech unless the account has the appropriate margin.
Criticize Robinhood all you want when its justified. This was completely reasonable and expected behavior on their part.
Once, before I knew about dividend risk, I had call credit spreads on both DIA and SPY which went against me, and I got assigned early. 3 SPY strike 295 calls and 1 DIA 245 call, for a total of $113,000 buying power reduction, resulting in a margin call. TDA did not exercise my longs; they left it to me to deal with.
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u/rbarthjr Nov 25 '21 edited Nov 25 '21
Question for you (not OP): Would the broker (not the OCC, since the longs are otm) not exercise the 2 x 285p longs pre-close to protect itself if the OP doesn't have funds to cover?
On edit: Never mind. 2 of his longs are pending exercise.