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Politics : Idea Of The Day

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To: Mike Hagerty who wrote (15642)12/16/1997 2:42:00 PM
From: Judy  Read Replies (1) of 50167
 
Mike, when you sell puts you have entered into a contractual agreement where the buyer has the right to assign you the stock at the strike price at any time between the date of execution and expiry.

Often stocks are assigned when they tank and the buyer of the put contract thinks the stock will not recover much within the subject time period. Imagine as an example someone who sold EFII Dec puts (I'm assuming EFII has options since I didn't check).

Re: "What's the point of doing options if they can be called or assigned at any time ?" Check some books on options strategies, they detail the relative benefits and risks.
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