Is it possible to create subassemblies out of inserted parts in the existing assembly?

If I had already made an assembly out of parts and I want to turn some of the parts into a sub assembly what do I do?

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Yes, select the parts, right click then click on Form New Sub-assembly Here.
This will also make the mates adapt so you won't lose any.

 
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Tutorial - How to create sub- assemblies out of inserted parts in the existing assembly

 
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