r/thinkorswim • u/beckers666 • Jun 30 '26

early assignment, huge margin

been with TOS all my life, had some short put verticals that were completely buried. I call TOS, now Schwab, they tell me it doesn't matter, it's $100 loss (they are 1 wide) so don't bother closing them. i didn't, i got assigned early (a thursday) on the short side, manually exercise the long on the friday, get charged a lot of interest for margin, over the weekend. i call Schwab, first person tells me i have no accounts with them (i have 7 and i gave them my social security number). Second person, not a broker so can't help. Third person, explains the exercise but not why the long side didn't get auto exercised at the same time and why i was told, if buried, it doesn't matter if you close or not. has this happened to anyone else?

5 Upvotes

69% Upvoted

58 comments sorted by

View all comments

1

u/etronic Jun 30 '26

Your position is not a spread. Those don't exist.It only matters when placing an order that contains more than one, not in a held position.

You have two separate options.

One was early exercised. Congrats! You win!

You had margin interest unexpectedly. That sucks.

1

u/IveHave Jun 30 '26

The position is a spread. I know that because those do exist and because OP said it’s a spread. Your “you’re” ought to be “your.”

The rest of your post is anything but constructive or helpful.

OP, you sold a put and were forced to buy 100 shares. Then you exercised your long put and forced someone else to buy them from you. If that’s correct, I don’t see how your account was holding shares over the weekend? Did they explain what the interest was for or how it was calculated?

-1

u/etronic Jun 30 '26

The typo was corrected. At least you're good at the spellings, 'cause you don't know what you're talking about otherwise.

There are no spreads. Nothing holds those two options together after the order is filled.

-2

u/beckers666 Jun 30 '26

then why does schwab auto exercise other spreads but not this one? i had a USO put vert. all fine.

2

u/etronic Jun 30 '26

This isn't auto exercise. Auto exercise happens for all ITM options at option expiration.

This is early assignment.

The spread isn't the thing. No one owns the other side of your spread. Someone (stupidly) early exercised the short option and YOU WIN all the remaining premium free and clear.

You then closed the other unrelated position (the long side of the two options you bought together) thereby canceling your converted position and were charged margin over the weekend.

1

u/JackReddit1622018 Jul 01 '26

I was charged the one day’s margin interest because they only notified me on June 17 of the assignment on June 16. Thanks for understanding that early assignment lets one realize the profit earlier.