Looking for some input on something that happened to me today with a 0DTE trade.

    I put on a SPY put credit spread:

    • Sold 100 contracts of the 713 puts
    • Bought 100 contracts of the 691 puts

    At entry, SPY was around 723, so I was well out of the money.

    Fast forward to the close:

    • Around 4:00 PM, SPY was still safely above my short strike (around the high 710s)
    • With about a minute left, SPY was roughly 6–7 points above 713

    Then at around 4:12 PM, my broker force-closed my short 713 puts, buying them back at a higher price than I sold them for, locking in a loss.

    I called them, and they said it was due to pin risk, claiming the position was “near the money” and that they reserve the right to liquidate based on their risk assessment.

    What’s throwing me off:

    • This was still multiple points OTM with essentially no time left
    • I’ve held similar positions into the close before without intervention
    • The forced close happened at a pretty unfavorable price

    My question:
    Do you think this was a reasonable risk management action by the broker, or an overly conservative move? For those trading larger size in 0DTE spreads, have you seen this kind of liquidation happen when still several points OTM near expiration?

    Pin Risk or Overly Conservative broker?
    byu/TorukMaktoM inoptions



    Posted by TorukMaktoM

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