Steve:I have a quick question on a short strangle. If you sell in-the-money calls, what are you stuck with at expiration, and how do you resolve it? It would seem that your account would be debited for the buy (from the puts) and you'd also have short stock from the sale of the calls. Is this correct? I'm trying to get around the spreads which turn my position into an unprofitable one. Thanks, -- H. Because the technical definition of a strangle position typically involves the simultaneous buying or selling of out-of-the money puts and calls on a one-to-one basis, I initially assumed that the reader was perhaps a little confused, and I first responded by explaining that in a strangle either the puts or the calls can be assigned, but not both. But follow-up emails clarified that both sides of the reader's strangle were actually in the money. Without getting into all of the details, what happened was that his current position wasn't his original intention (the initial trade was simply shorting some put options), but rather resulted from an adjustment made in an attempt to minimize the potential loss due to a decline in the underlying stock price. Generally speaking, most investors should be very selective and show restraint when adjusting positions; sometimes it's better to just close out the position rather than embark on a salvation project that requires additional transactions. This is because every new strike added to the existing position is an additional component that requires monitoring and represents another element that can go wrong. Too many adjustments or pieces can tangle a position to the point at which you no longer know what you have or what you want to happen. That said, in selling some in-the-money calls against his short puts, the reader has kept his adjustments to a minimum and the position fairly simple. What he has done is gain some downside protection for his short puts if the share price keeps falling, and he can capture whatever time premium was remaining in the options. However, the risk here is that if the stock rallies sharply, he'll find himself with a negative delta, and will lose money on the short side of a stock in which he was originally bullish.