The "daily Call" From Option Alpha: Options Trading | Stock Options | Stock Trading | Trading Online

Hey everyone. This is Kirk here again from Option Alpha and welcome back to the daily call. Today, we’re going to answer the question – “Can I be assigned on an option contract even if it’s out of the money?” This is a common question that a lot of people have and I think the root of this question is just the fear of assignment. Most people actually fear that when the option contract goes in the money, that immediately, the option contract is going to be assigned. Now, we know that’s not the case and we’ve talked about this a number of times before, not only on this podcast, but also through our training and courses on the website. But now, the question is – “Even if an option contract is out of the money, do we still have risk of assignment?” Now, technically, yes, it could be assigned. You could get a random assignment from the option buyer. But is this likely to be the case? In all circumstances, probably not. I would say the actual reality of this happening is probably very, very small, maybe under 1/10th