Wash Sale on Covered Call Assignment?


Hi all. I'm a little unclear on how the wash sale rule applies to selling covered calls, or if it does at all. Here's my scenario:

  1. I bought 100 shares of stock XYZ for $20 per share.
  2. I later bought 50 shares more of stock XYZ for $30 per share.
  3. I sell to open a Call option for XYZ at strike of $25 when the stock price at the time is $21 which makes me $15 for the sale of the call.
  4. Expiration date comes around and the call is now ITM since XYZ is now selling at $27. The call gets exercised!

My question about this example is, if some of the assigned 100 shares are from the pool i bought at $30 per share does that mean I must refrain from buying any more XYZ shares for 30 days to avoid wash sale? If so, can I avoid this by changing my disposal method or calling up my broker to make sure only those under the strike price are assigned?


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