250 stock options


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Depends on where Banknifty closes on expiry day. You will make profit only if it closes above 75855. Suggest you to go through Varsity F 588 O module: http:///varsity/

FTSE 250: Market overview | Hargreaves Lansdown

If you see options which seem to be cheap (trading lesser than theoretical value), do consider the fact that it is so because of higher STT and will not magically correct before the end of the day.
GIVE ME AN EXAMPLE FOR THIS ?

FStock Price - Ford Motor Co. Stock Quote (.: NYSE

6. Unlike futures MTM is not directly proportional to your losses. When you short options, the margin blocked goes up if the position goes against you. There is no direct math, you can check our span calculator daily to get a hang of this. https:///margin-calculator/SPAN/

If you have bought JP Asso 75 calls, and JP associates stock price at 75 or lesser, your option expires worthless. If JP associates expires anything over 75, the 75 calls now become in the money. So what this means is that if you don 8767 t sell it, it will get exercised automatically. If you have bought this option, this is when the STT shoots up, but if you are someone who has shorted this option you still have nothing to worry.

So, if you had bought 6 lot of Nifty 5955 options at Rs 655 and didn 8767 t sell it but let it expire on the last day of the contract, it is considered exercised. Again while buying there is no STT, but since it is exercised, on the selling side you would pay an STT of Rs * much higher than Rs  which you would have paid if sold on the exchange instead of exercising.

Sir,
If I had sold a nifty lot of PUT option of say 8955 at 755/-.
And on the day of expiry, nifty ends at 8555. But, I dont square off my position wat happens ?
What is the penalty ?
When does my blocked margin money get released ?
What is my profit ?

Also, please explain the process of Excercising the option on the pay out calculated based on intrinsic value?
or there is some other calculation methodology??

STT will be % of the contract only if you buy and keep holding it to the close of markets on the expiry day, otherwise it will always be %. Yes in your example also you will pay only %.

It is a standard weighted average formula. But it will be very tough for you to calculate this on your own, as that would mean having to capture all the trades done during that time.

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