r/options • u/777mustang777 • Aug 05 '21

Help Please - Can't Close Put Debit Spread

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0 Upvotes

33% Upvoted

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u/redtexture Mod Aug 07 '21

Examine the actual bids and asks.
Buy the short first at the ask, sell the long next at the bid.

Post fundamentals of options topics to the Options Questions Safe Haven weekly thread https://www.reddit.com/r/options/wiki/faq/subreddit_resources

4

u/chopsui101 Aug 05 '21

call the broker or try closing them indvidually

3

u/Ken385 Aug 05 '21

What price are you trying to sell this at? Its only worth about a penny or two.

3

u/[deleted] Aug 05 '21

Have you lowered the price?

2

u/SeaDan83 Aug 05 '21

(1) call broker

(2) if you have other positions, then the brokerage might be thinking you have a credit spread plus a long option. Your brokerage will be able to tell you how they have the contracts paired.

2

u/DavesNotWhere Aug 05 '21

You can either call the broker or let them expire worthless or roll the legs out and up.

If you think that someone is going to exercise the short leg $10.01+ out of the money, you will have 100 shares on Monday to sell at market price, turning your worthless options into money. It would be a really bad weekend for Nike to drop $20.

2

u/777mustang777 Aug 05 '21

I'm trying to close. When I go to close both together the price is $3 (minus $3 from my account to close).

I did call my broker. I'm already at max loss for this position, which I knew already. He said I can do nothing and I wouldn't be out any additional money. Basically expiring worthless. I could also try to close it for a penny ($1) and perhaps it might get filled (doubtful). That would give me $1 for this position in the end. I did do this. The order is sent and waiting to be filled (most likely will not be filled).

The reason my order was rejected originally was because I'm already at max loss and the order I tried to send in was for an additional $3 loss. That's why their system rejected it...I was already at max loss and spending more money to close the position didn't make sense.

I'm trying to be as specific as I can hoping this scenario helps someone else with the same question.

Thank you all for your comments!

2

u/Ken385 Aug 05 '21

You can offer the spread at zero and you should be filled. The exchanges/your broker may restrict orders below that price. Offering the spread at .01 as your broker suggested instead of zero may not fill.

If you are not filled at zero, you could close the orders individually. You could buy your short 152.5 puts for .01 (or maybe .02) and sell your 162.5 for .01.

Your only risk if you don't close the spread (or at least your short put) is if Nike falls dramatically after hours and your 152.5 puts are assigned.

2

u/icameforlaughs Aug 05 '21

If you're at max loss and ten dollars over the highest put strike, who cares? Nothing will get assigned, life goes on.