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Dealing with Stock Assignment & Dividends

Stock assignment of a short option position is nothing to be afraid of. Here is a detailed example of how to deal with an assignment after a dividend, and how the position can still be managed for a profit.
Dealing with Stock Assignment & Dividends
Kirk Du Plessis
Apr 19, 2021

Back on September 18th we were assigned 100 shares of short stock on XLU following a dividend date on our original short straddle trade. Most traders naturally freak out when they get assigned stock, but we’ll show you why this assignment didn’t hurt us at all (even after paying the dividend) and still leaves us with a profit overall.

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