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What is an assignment fee?

In one line: An assignment fee is a charge some brokers add when an option you sold is assigned, or one you hold is exercised, on top of normal trade commissions.

Trading glossary · Updated 2026-10-26

How it works

When you're assigned, your broker books a stock trade: you buy or sell 100 shares at the strike. Some brokers charge nothing extra for that. Others charge a flat assignment or exercise fee each time. Prices change, and some brokers waive the fee, so check your broker's current pricing page.

The fee is separate from the Per-contract fee you paid to sell the option. It's also separate from the small regulatory fees on stock sales.

A flat fee is the same whether the stock costs $5 or $500. That's why it matters most on cheap stocks.

An example (hypothetical)

Say a broker charges a $15 assignment fee and $0.65 per contract. Both are made-up numbers for the example, not real broker prices (an illustration, not a trade idea).

You sell a $5 put on a cheap stock for $0.20 and collect $20.

On the $5 stock, the fee took three-quarters of the premium. An assignment that was nearly break-even became a loss.

Now compare a $50 put that pays $1.00, or $100. The same $15.65 is about a sixth of the premium. Still real, but not most of it. A math example, not a promise.

Why it matters for sellers

The wheel strategy expects assignment. Each turn can mean one put assignment and one call assignment. If your broker charges for both, count them in your math before you start, not after.

Small accounts often pick cheap stocks so the cash fits. That's when flat fees hurt most. Check the fee, then ask whether the premium still makes sense after it. Sometimes buying back the option before expiry costs less than taking the assignment, and sometimes it costs more.

In Canada, fees and options permissions also differ by broker and by account type, so check before you trade in a TFSA or RRSP.

Questions