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How to avoid holding Options that expire worthless?
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Disgusted by Market Manipulation

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pcwSg joined discussion · Dec 11, 2023 08:32
It is when such things happen to you, that you start to reconsider if participating in the market is worth it...
To drop into a trap and be squeezed of money doesnt feel good at all...
What Had Happened
Was trading $Adobe(ADBE.US)$ options last Friday.
Was short-sighted and convinced it wont go higher than 610 last Friday, but not considering earnings is coming this week and tons of positive news is being reported.
Disgusted by Market Manipulation
Bought a PUT spread of 610/621.5 with a decent fill of 2.14, paying $214. With $250 max risk and max profit of $36.
Disgusting 0.010
Disgusted by Market Manipulation
Things were going fine the whole session, until the last couple hours where it started to go up, almost touching 610.
At the very last moment before market close, it hit 610.010...
That 0.010 made the 610 PUT expire worthless instead of being exercised. As long as the price stayed below 610, both legs of the spread would have been exercised for a simple $36 profit.
To make things worse, people who are trapped like me are at -100 ADBE shares, so pre-market, the price of ADBE kept going up, coupled with the fact that ADBE is expected to do well in upcoming earnings release and also analysts bringing up their price targets for ADBE.
Final Resolution
The position of -100 shares had been liquidated automatically:
Disgusted by Market Manipulation
At an average price of 613.70...
This means the total loss from this trade surpassed the $250 max loss for the spread, and became $214+100(613.70-612.50)=$334.
Am utterly disgusted by this result, though the dollar amount is fortunately very small because i only did 1 contract, but the series of events especially the 0.010 which made a simple $36 profit become a $334 loss makes my heart sink...
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