Replies to post #18448 on Advanced Micro Devices Inc (AMD)

[sgolds]

HailMary, excellent example and explanation! Now, one question -

At expiration, I'll have to cough up $170000 to purchase the shares through either a put assignment or a call exercise.

What happens if the stock closes at exactly 17 at expiration? It is possible to be subject to both a put assignment and a call exercise. I wonder if this ever happens, or is just a theoretical case? After all, there is no net profit or loss for either the put assignment or the call exercise, although if one were to be hit by both I'd think it impacts one's liquidity - he has to provide $340,000 and gets twice the amount of stock.