Did someone close out of my position?
Our risk team may intervene if they do not receive notice
The tastyworks risk team monitors potential expiration risk throughout the day and periodically sends notifications to accounts that have excessive potential expiration risk. As the end of the day approaches, the risk team may need to start closing positions that pose an excessive risk. To learn more about expiration risk, please click here.
The number of accounts with potential risk and market volatility can affect how early our risk team needs to act. However, our Risk team will try to hold off as long as we can to give our client's as much time as possible to manage their positions.
How can I prevent the Risk Team from intervening?
Just let us know that you're monitoring your account and positions
If you email firstname.lastname@example.org on expiration day (prior to 12:00 PM Central) and assure our Risk team that you will close any expiring position(s) that may pose an excessive risk, then we will allow you best efforts to close your expiring position–generally up until the last 5-10 minutes of trading. Furthermore, if your account held an expiring option(s) position overnight before expiration day, then our Risk team will email an Expiration Notice. You can reply to that notice and let us know. However, please keep in mind the following:
- We can not maintain "standing requests"; we need to be notified each expiration on the expiration day.
- If you indicate that you are monitoring your positions, our risk team may still close positions on your behalf if deemed necessary.
- If you indicate that you are monitoring your positions and do not act, then we may not be able to accept these requests going forward.
- Short options can still be assigned if they close out of the money. This means that short options that close out of the money may pose potential expiration risk. The only way to eliminate expiration risk associated with short options is to close them.
If you do not close a position that poses an excessive risk, we may trade stock against it as a hedge. The resulting stock position will be your responsibility.