Monday, June 16, 2014

Document me this ...

"The representations of the defendants again contradicts the promotional material, posted for Canadian consumption 24/7/365 over the past four years.

“Options that are "in-the-money" will be auto-exercised; however if you choose not to exercise the option, your only cost is the premium.”

http://cibcinfo.com/exchange/fall2010/article.php?lang=en&v=&article=3&link=nav



The Canadian Derivatives Clearing Corporation (CDCC) is the issuer, clearing house, and guarantor of equity options in Canada. CDCC rules governing the exercise of “in-the-money” equity options at expiry is clear.

“Under CDCC current rules all Equity, Bond and Index options in client accounts that are in-the-money by .01 or more are automatically exercised.”

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What CIBC is telling the public regarding the exercise of "in-the-money" equity options at expiry ...

" the options were not exercised for the following reason. To auto exercise would have represented an ECA short position of 2000 shares and a margin requirement of $ 15,000. As no margin was available in your account at that time, no exercise was initiated."