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Learn about options exercise and options assignment before taking a position, not afterward. This guide can help you navigate the dynamics of options expiration.

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three. Roll it to something else. Rolling, which is essentially two trades executed for a spread, is definitely the third choice. A single leg closes out the existing option; the other leg initiates a new position. For example, suppose you're short a covered call on XYZ on the July a hundred and five strike, the stock is at $103, as well as call's about to expire.

Keep in mind, there isn't any promise that there will be an active market for an options contract, so it is actually possible to finish up stuck and unable to close an options position.

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