AppliedMultiple choice
You are short a deep in-the-money American call on a stock going ex-dividend tomorrow. When should you expect to be assigned tonight?
- AOnly if the stock falls below the strike before the close
- BWhen the dividend exceeds the call’s remaining time value
- CNever, because American calls are never exercised early
- DAlways, because every in-the-money call is exercised the day before any dividend
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