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Assignment and exercise fees: what brokers charge, and when it matters
Many US brokers now charge nothing when a sold option is assigned, but some still charge a flat fee, and most charge a small per-contract commission to open or close. The fee is the same on a cheap stock as on an expensive one, so on a $5 stock it can be most of the premium. Here's the list and the math.
The four fees a seller can meet
| Fee | When you pay it | What it tends to look like |
|---|---|---|
| Per-contract commission | Every time you sell to open or buy to close | Zero at some brokers, under a dollar per contract at many. See Per-contract fee |
| Assignment fee | When your short option is assigned | Zero at many US brokers now; a flat fee at some. See Assignment fee |
| Exercise fee | When you exercise an option you bought | Same as the assignment fee at most brokers. Sellers rarely pay it |
| Regulatory and exchange fees | Tacked onto option trades, mostly on the sell side | Cents per contract. Shown separately on the confirmation |
We're not going to print a table of brokers and dollar amounts. Fees change, and a number that was right in October 2026 won't be right forever. Your broker's fee schedule is one page; read it once and write down your four numbers.
Canada: fees differ by broker there too (Questrade, IBKR and Wealthsimple each publish a schedule), and options permissions are set per account, so covered calls in a TFSA are widely allowed while cash-secured puts depend on the broker.
Why the fee is bigger than it looks on cheap stocks
A per-contract fee is flat. The premium on a cheap stock is small. So the fee is a bigger slice.
| Stock price | A 30-day put strike 10% below | Premium collected | A $0.65 per-contract fee as a share of it |
|---|---|---|---|
| $200 | $180 | $3.50 ($350) | 0.2% |
| $50 | $45 | $1.00 ($100) | 0.7% |
| $10 | $9 | $0.25 ($25) | 2.6% |
| $4 | $3.50 | $0.08 ($8) | 8% |
Now add a close. If you buy the put back at half its value to take the gain, you pay the fee again. On the $4 stock, two fees are $1.30 of an $8 premium, before the bid-ask spread. The spread on a $0.08 option is often $0.05 wide, which is most of it. See the bid-ask spread cost.
An assignment fee, where one exists, is the same story. A $15 flat charge on a $350 premium is a small slice. On an $8 premium it's double the premium.
A worked example (an illustration, not a trade idea)
A made-up stock, XYZ, trades at $8. You've got a small account and you sell one 30-day $7.50 put for $0.20. You collect $20. Your broker charges $0.65 per contract and, in this illustration, a $5 assignment fee. Your broker sets aside $750.
| XYZ at expiry | What happens | Shares | Premium | Fees | Total |
|---|---|---|---|---|---|
| $5 | Assigned at $7.50; you sell the shares at $5 | −$250 | +$20 | −$0.65 −$5 −$0 (stock trade free) | −$235.65 |
| $7 | Assigned at $7.50; you hold | −$50 | +$20 | −$5.65 | −$35.65 |
| $7.50 or above | Expires | — | +$20 | −$0.65 | +$19.35 |
| You close early at $0.10 to lock half | — | — | +$20 −$10 | −$1.30 | +$8.70 |
In the top row, fees are 2% of the loss. In the bottom row, they're 13% of the gain. Fees don't cause losses; they shrink wins, and they shrink small wins most. That's a math example, not a promise.
Compare the same trade on a $50 stock: a $45 put for $1.00, same fees. Expires: $100 − $0.65 = $99.35. Closed at half: $50 − $1.30 = $48.70. The fee is the same; the slice is a fifth the size.
Does "no assignment fee" mean assignment is free?
The fee is zero at many brokers. The trade isn't free of cost. Assignment turns your option into a stock trade at the strike. You pay whatever your broker charges for stock trades (often nothing in the US). What you don't get to choose is the price: it's the strike, whatever the stock is doing. That's Assignment, and the cost is in the shares, not the fee line.
Fees you avoid by letting it expire
If your short option is out of the money at expiry and you let it go, there's no closing trade and no fee. That's one argument for holding to expiry. The arguments against are stronger when the option is anywhere near the strike: pin risk, after-hours moves, and the tiny premium left versus the full risk still open. See why sellers close before expiration.
A reasonable habit many sellers settle on: let it expire when it's worth a few cents and well out of the money; pay the fee to close when it's near the strike.
Where fees change the decision
- Cheap stocks (under about $10). The flat fee is a real share of every trade. Either accept thinner results or sell fewer, longer-dated options so each one carries more premium. Our page on the cheapest way to start selling options weighs this.
- Weekly cycles. Four fees a month instead of one. On liquid, pricier stocks it's noise. On cheap stocks it adds up.
- Rolling. A roll is two legs, so two per-contract fees, every time. Six rolls on a losing position is twelve fees and still a losing position. See rolling mistakes.
- Many contracts. Per-contract means per contract. Ten contracts, ten fees, each leg.
In plain words: fees are small, flat and honest. On a big premium they vanish. On a tiny premium they're the whole story. Check the slice, not the dollar.
What to do with this
- Find your broker's fee page. Write down: per-contract, assignment, exercise, and the stock commission. Four numbers.
- For your next trade, divide the total fees for open-and-close by the premium. Under 2%, fine. Over 10%, the trade is too small for the fee.
- If you're running the wheel strategy on cheap stocks because that's what the account allows, count the fees in your journal as part of every result. They're part of the result.
Questions
Do brokers charge a fee for option assignment?
Many US brokers charge nothing now, but some still charge a flat fee per assignment or exercise. Fee schedules change, so check your broker's current page.
What is a per-contract fee?
A flat commission charged each time you open or close an option contract. It's often under a dollar per contract in the US and zero at some brokers.
Why do fees matter more on cheap stocks?
Because the fee is flat and the premium is small. A fee that's a fraction of a percent on a $350 premium can be 10% or more of an $8 premium, before the bid-ask spread.
Is it cheaper to let an option expire than to close it?
Yes, in fees: expiring costs nothing, closing costs a commission. But if the option is near the strike, the small fee buys certainty about whether you'll be assigned, which is usually worth it.
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