Hi Mark,

Just happened to find this forum. Very educational.

I wrote a covered call from my IRA account. Once the expiration date came, the stock price is higher than strike price by few dollars. But i seem to still own the stock.
what could have happened? I thought broker would sell my stock?

Thanks

Chandra

Hello Chandra,

It is virtually impossible (in reality it IS impossible) for this situation to occur - as you describe it.

1) Are you referring to an expiration date (Apr 2008) that arrived yesterday?  The true expiration date is today, Saturday.  Thus, the stock will be sold over the weekend when the automatic exercise takes place.  You will no longer own the stock on Monday morning.

2) Are you referring to a past expiration?  Are you certain the stock was above the strike price when expiration day arrived?  Remember, if the stock passes the strike price after expiration, it's too late for the call owner to exercise the option.

It is possible for an option not to be exercised when the stock is above the strike price by a few pennies, but not a few dollars.

Mark

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Mark D. Wolfinger
The Rookie's Guide to Options:
The Beginner's Handbook of Trading Equity Options