In this week's episode, sprocket888 revisits his AAPL trade for the 3rd time. This time AAPL has encountered some early assignment risk from a dividend distribution. This is not a very common situation, so we dive into the details to learn something. As a mitigation tactic to the assignment risk, sprocket rolls the AAPL short call out in time. Rolling an option is a valuable and fundamental tool for any option seller. sprocket breaks down the anatomy of an options roll using this specific AAPL example. Understanding how the roll works and why it can increase your net premium is invaluable.

Rotten AAPL Pt1: Managing a rotten $AAPL Pt. 1

Rotten AAPL Pt2: Rotten AAPL Part 2: A detailed breakdown of the thought process

• 00:00 Disclaimer
• 00:19 Intro
• 01:12 Continuing the AAPL Trade
• 01:27 Recent events with AAPL leading to elevated assignment risk
• 02:00 Recap the AAPL trade history
• 05:52 What is a dividend assignment risk?
• 07:05 Squeezing a bit more premium out before the dividend
• 09:31 How can you tell how much early assignment risk you have?
• 11:29 Two pricing components, Intrinsic and Extrinsic value
• 12:49 Dividend risk indicator: Extrinsic value vs. Dividend Value
• 14:32 Early assignment risk is NEVER zero
• 15:05 Why is a roll ALWAYS for a credit
• 17:47 Conclusion: Know all the angles to make smarter trades
• 19:14 Outro

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