Jim Schultz Explains the Early Assignment That Catches Every Trader.

It happens to every options trader eventually: your short call is gone, replaced by short 100 shares. Jim Schultz explains that early assignment usually is not a glitch, it is mechanical, driven by dividend risk versus the extrinsic value in the call. It is a short call phenomenon, because only shareholders collect a dividend. If the extrinsic value left in the call is bigger than the upcoming dividend, the long holder would rather sell it, so you are usually safe. If the dividend is bigger, it pays them to exercise, and that is when you get assigned. He shows how to check the ex-dividend date and the expected dividend to gauge your risk. This is education, not a recommendation. 📊 tastylive: https://www.tastylive.com/ 📰 Get Tom's pre-market analysis every morning: https://www.tastylive.com/newsletters 📘 FREE Options Strategy Guide: https://tinyurl.com/bp9ms763 📱 Follow tastylive on X: https://x.com/tastyliveshow Chapters 00:00 When your short call disappears 00:39 Why assignment feels like a glitch 01:02 Why it is a short call problem 01:44 Extrinsic value vs the dividend 02:53 A hypothetical example 04:35 A live look at a real dividend 05:57 Reading the in-the-money calls 07:36 Assignment is a when, not an if #tastylive #optionstrading #earlyassignment #dividends #jimschultz #calculatedrisk #shortcall #optionsstrategy #coveredcalls #optionseducation tastylive is a real financial network, producing hours of live programming every day. Follow along as our experts navigate the markets, provide actionable trading insights, and teach you how to trade. With over 120 original segments, and over 25 personalities, we'll help you take your trading to the next level, whether you are new to trading or a seasoned veteran. tastylive content is created, produced, and provided solely by tastylive, Inc. ("tastylive") and is for informational and educational purposes only. It is not, nor is it intended to be, trading or investment advice or a recommendation that any security, futures contract, digital asset, other product, transaction, or investment strategy is suitable for any person. Trading securities, futures products, and digital assets involve risk and may result in a loss greater than the original amount invested. Investment information provided may not be appropriate for all investors and is provided without respect to individual investor financial sophistication, financial situation, investing time horizon or risk tolerance. Options, futures, and futures options are not suitable for all investors. Prior to trading securities, options, futures, or futures options, please read all applicable risk disclosures, including, but not limited to, the Characteristics and Risks of Standardized Options Disclosure and the Futures and Exchange Traded Options Risk Disclosure Statement found at https://tastytrade.com/disclosures/. Past performance is not indicative of future results. Performance is not presented net of all commissions, fees, and expenses. Multi-leg option strategies incur higher transaction costs than single leg trades as they involve multiple commission charges. Examples provided are for illustrative, informational, and educational purposes only and are not intended to be reflective of results you can expect to achieve. Supporting documentation for any claims, including claims made on behalf of options programs), comparisons, statistics, or other technical data, if applicable, will be supplied upon request. tastylive, through its content, financial programming or otherwise, does not provide investment or financial advice or make investment recommendations. tastylive is not a licensed financial adviser, registered investment adviser, or a registered broker-dealer.