Option assignments represent a critical moment in any covered call or cash-secured put strategy. When assignments happen, accurate tracking becomes essential for understanding your true cost basis and maintaining control of your positions. This tutorial walks through two real assignments: a covered call assignment on Altria (MO) at $45.50 strike and a cash-secured put assignment on Rumble (RUM) at $9.00 strike.
Proper assignment tracking ensures you maintain accurate cost basis calculations, understand your actual profit or loss on the position, and set up subsequent trades with complete information. This guide demonstrates the complete workflow for recording both types of assignments in MyATMM's cost basis tracking system.
Understanding the fundamental difference between covered call assignments and cash-secured put assignments is essential before tracking them. Each assignment type affects your portfolio differently.
When a covered call gets assigned, you're selling shares you already own at the strike price. This closes out a stock position and frees up capital:
MO call at $45.50 strike gets assigned on 100 shares. You sell 100 shares at $45.50 (regardless of current market price), receiving $4,550 in cash. The call option is removed from your positions, and if this was your only position, MO is completely closed out of your portfolio.
When a cash-secured put gets assigned, you're purchasing shares at the strike price. This creates or adds to a stock position and uses up collateral:
RUM put at $9.00 strike gets assigned on 1 contract. You purchase 100 shares at $9.00 per share, using $900 of cash. The put option is removed, the $900 collateral is no longer reserved, and you now own 100 shares at $9.00 cost basis (before factoring in premium collected).
Call assignments reduce share count (negative shares), while put assignments increase share count (positive shares). Call assignments generate cash inflow, while put assignments require cash outflow. Understanding this distinction prevents tracking errors when recording assignments.
The RUM $9.00 put expired in-the-money on December 2nd, triggering assignment. This walkthrough shows the complete process for tracking this put assignment in MyATMM.
Start by navigating to the RUM cost basis page where all your positions for this ticker are tracked. The interface shows your current positions including any active calls, puts, and shares held.
Locate the specific put contract that was assigned. Check the details to confirm:
When you click the "Assign" button for the expired contract, MyATMM prompts you to specify the assignment type. Select "Put" to indicate this was a cash-secured put that's forcing you to purchase shares.
Fill in the assignment transaction details that will generate the proper records:
When you submit the assignment, MyATMM generates "proposed records" in a staging area. These helper records are automatically calculated based on your positions and the assignment details. Proposed records prevent manual data entry errors by generating the correct transactions for you to review before saving permanently.
After submitting the put assignment, MyATMM automatically creates a new stock position record showing:
This stock position record now appears in your proposed records section, ready to be saved to your permanent tracking.
The critical step many traders miss: MyATMM generates a proposed stock purchase record automatically. You need to save this proposed record to make it permanent, but there's an important detail to avoid duplicate records.
The assignment submission already created and saved the stock purchase record to your transaction history. The proposed record is a helper to show what was just saved. If you click "save" on the proposed record immediately, you'll create a duplicate. Instead, verify the record looks correct, then copy it down if needed or simply acknowledge it was already saved by the assignment process.
Now that RUM has been assigned and you own 100 shares, update your position display:
Click save on the position to update these values. Your cost basis calculations automatically adjust to reflect the new average cost across all 400 shares.
The final step is cleaning up the expired contract. Since the $9.00 put has been assigned and no longer exists, delete it from your active positions. This prevents confusion when reviewing current positions and ensures your tracking reflects only active contracts.
The RUM assignment demonstrates how put assignments lower your average cost basis. If you previously held 300 shares at $12.00 and just purchased 100 shares at $9.00, your new average cost basis drops to $11.25 per share across 400 shares. This cost basis improvement is a core benefit of the wheel strategy.
The MO $45.50 covered call expired in-the-money, resulting in assignment that closed out the entire position. This walkthrough shows how to track a call assignment that exits a stock completely.
MO (Altria) is a high-dividend paying stock that offered consistent but small weekly premiums through covered calls. The strategy was to collect small premiums each week while targeting a break-even exit at $45.50 cost basis with premium included.
Target exit price was $45.50 break-even. The stock eventually rose above this level, triggering assignment. While the stock continued to $47.50, the strategy was designed to exit at break-even, not to capture all possible upside. This is the tradeoff of covered call writing: you cap gains in exchange for premium income.
Navigate to the MO cost basis page and locate the call contract that was assigned:
Click the "Assign" button on the expired call contract and select "Call" to indicate this was a covered call forcing you to sell shares.
Fill in the call assignment transaction details:
When tracking call assignments, always use negative shares to indicate you're selling. This ensures your position tracking correctly reduces share count. For MO with 100 shares, entering -100 shares brings the position to zero, properly reflecting that the assignment closed your entire stock position.
Unlike put assignments that create new positions, call assignments generate sale transactions. MyATMM creates a proposed record showing:
The proposed sale transaction needs to be moved to your permanent transaction history. Click the button to copy this proposed record down to your transaction log, then save it.
This records the stock sale at $45.50 per share, which will be used for calculating your actual gain or loss on the position when considering all costs and premiums collected.
Since the call assignment sold all 100 shares, update the MO position to reflect zero shares remaining:
Click save to record the updated share count. With zero shares, you no longer hold any MO stock.
Delete both the assigned call contract and the stock position record since they no longer represent active positions. This cleanup ensures your cost basis page only shows current holdings.
With the position completely closed, MyATMM calculates your final result on the MO position:
While $6.78 profit on a $4,550 position isn't substantial, this represents a successful execution of the break-even strategy. The goal was to exit at break-even cost basis, and that was achieved with a small profit after all premiums were factored in.
MO is a dividend stock that doesn't offer large option premiums due to lower volatility. The strategy produced small weekly premiums while waiting for price to reach the break-even exit point. Not every position needs to generate large returns; sometimes the goal is capital preservation while collecting consistent small premiums, then exiting at break-even when the opportunity arises.
Properly tracking option assignments requires attention to detail and understanding the workflow. These best practices prevent common mistakes and ensure accurate cost basis maintenance.
Track assignments within a day or two of occurrence, while the details are fresh and the market context is clear. Waiting weeks to record assignments increases the risk of forgetting details or making errors.
Always confirm you're entering the strike price, not the current market price, when recording assignments. The assignment happens at strike price regardless of where the market closed.
If MO closed at $47.50 but your call strike was $45.50, you enter $45.50 as the assignment price. The extra $2.00 per share in market value is foregone upside from selling the call. Don't try to record the market price; record the actual assignment execution price.
Put assignments use positive shares (you're buying). Call assignments use negative shares (you're selling). Getting the sign wrong will completely throw off your position tracking.
MyATMM's proposed records are helpers to prevent manual calculation errors, but you must review them:
When puts get assigned, the collateral that was reserved for the put is now used to purchase shares. Update your collateral to zero for that position to reflect that the cash is no longer reserved.
After recording assignments, verify how they affected your cost basis:
Delete assigned contracts from your active positions after recording the assignment transaction. Keeping expired contracts clutters your tracking and can lead to confusion.
Consider adding notes about why you selected certain strikes and what your strategy was for the position. This provides valuable context when reviewing past trades.
Your cost basis calculations drive future trading decisions. If you enter assignments incorrectly, your cost basis will be wrong, leading you to select inappropriate strikes on future trades. Taking the time to record assignments accurately ensures you always know your true position and can make informed decisions on subsequent covered calls and cash-secured puts.
Understanding when and how assignments occur prevents confusion when you see unexpected results on Friday evenings after market close.
Options assignments are determined by the closing price during regular market hours, not after-hours prices:
Earlier in this series, NVAX had a put at $16.50 strike. Stock closed at $16.52 during regular hours (no assignment). After hours, stock dropped to $16.40 (would have triggered assignment if it mattered). But assignments only use regular hours closing price, so despite after-hours price being below strike, no assignment occurred. This created an opportunity to sell another put at the same strike for more premium.
Some brokerages automatically exercise options that are $0.01 or more in-the-money at expiration. This means:
The gap between Friday close and Monday morning creates a brief uncertainty period where you don't yet see assignment results in your brokerage account. During this time:
Tracking assignments manually in spreadsheets creates numerous opportunities for errors. MyATMM's purpose-built assignment tracking workflow prevents common mistakes and ensures accurate cost basis calculations.
When you record an assignment in MyATMM, the platform automatically generates the correct transaction records:
See all your positions, active contracts, and cost basis calculations on a single screen:
MyATMM walks you through the assignment process step-by-step:
Manual spreadsheet tracking of assignments requires correctly calculating new cost basis across multiple transactions, updating formulas, and avoiding accidental deletions. MyATMM eliminates these error points by automating the calculations and providing a structured workflow that ensures every assignment is recorded properly.
Every assignment creates a permanent record in your transaction history, providing:
Properly tracking option assignments is essential for maintaining accurate cost basis and making informed trading decisions. These key lessons ensure you handle assignments correctly:
Your ability to select appropriate strikes for future covered calls and cash-secured puts depends entirely on knowing your accurate cost basis. Tracking assignments correctly ensures your cost basis calculations reflect reality, enabling you to make informed decisions on every subsequent trade in the wheel strategy.
Options trading involves significant risk and is not suitable for all investors. Covered call assignments cap your upside potential, meaning you may miss substantial gains if the stock continues rising. Cash-secured put assignments require sufficient capital and commit you to purchasing shares at the strike price even if the stock declines significantly below that level. Tracking errors can lead to incorrect cost basis calculations and poor trading decisions.
This content is for educational purposes only and should not be considered financial advice. Every trader's situation is different. Always conduct your own research and consider consulting with a qualified financial advisor before implementing any options strategy.
Stop struggling with spreadsheet formulas and manual cost basis calculations. MyATMM provides purpose-built assignment tracking that ensures accurate cost basis after every assignment.
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