No. of Recommendations: 3
Forgive me, but if the option is exercised, can you choose which lots you say goodbye to and optimize taxation?
I have no idea, maybe there are some US people who know about such things.
Contractually, you merely have to deliver stock--the contract doesn't really care where it comes from, but your broker will pull it from your account using some method I can't speculate on.
If you don't own stock, [at least some] brokers will sell it short for you to make the delivery. (I think I had this happen a few times, I just bought the stock the next day to zero it out. You end up short the stock, but they also give you the cash from the exercise of the call).
If you had more than one account, I guess you could write the call in the account whose stock you were most willing to part with?
Jim
