Looking for some clarity on trading US options using employer-provided shares. Here is a specific scenario and proposed strategy:
- Tax Status: The individual is an Indian tax resident.
- The Asset: They have received US-listed RSUs from their employer.
- The Strategy (Covered Calls): Can this person sell covered calls (Call STO) against these RSUs? (Assuming they hold the required lot size, which is 100 shares for a standard US options contract).
- Assignment (ITM): If the option expires In-The-Money (ITM) and the shares are called away, can the funds be used to buy the shares back within 180 days?
- Repeating the Process: Once the shares are repurchased, is the individual allowed to continue selling covered calls on them?
Has anyone seen or executed this strategy? I would love to know if there are any FEMA, LRS, or taxation hurdles to be aware of before attempting this. Thanks in advance!
u/Background_Wear237 — 9 days ago