June 24, 2013 at 5:44 pm

Avatar of cbrt
Joined: Jun. 24, 2013 Posts: 1

On May 7, 2013, I sold TLAB covered calls expiring on June 22, 2013, with strike at $3.00.

Today (June 24, 2013) I found that all my options got exercised (all my 1800 shares were sold at $3.00).

However, TLAB’s share price today is only around $2.00. Even on June 21, 2013, the share price was as high as $2.075.

Could anyone help me to understand why the options got exercised?

I believe the buyer of my covered calls must be an insider who knows something good is coming soon. Otherwise why this guy wanted to lose almost $1 per share? That’s $1800! This guy must know that very soon he or she can make much more than that.

Thank you very much!

June 25, 2013 at 10:52 am

Avatar of moderatorval
Joined: May. 30, 2013 Posts: 54

Wow – your theory makes the most sense to me, as well. I can’t fathom why someone would elect to pay $3.00 a share when they could have bought shares ~$2.00 on the open market.

“Everyone must choose two pains: The pain of discipline, or the pain of regret.” Jim Rohn

June 25, 2013 at 4:15 pm

Avatar of golfken
Joined: Jun. 25, 2013 Posts: 1

I would probably ask your trading platform to review the exercise.

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