Whats up pals, i want assist in understanding bodily supply mechanism of present inventory possibility. So, give me information on this. For this we are going to take INFY (Infosys) instance.
Now, INFY at present at 1974 and that i quick 1900 pe possibility at 21 at present. Suppose on expiry day INFY closes at 1930 and that i preserve money & all required margin cash with me in account than what’s going to occur ? Do i get bodily supply and if i get it than at which value ? thanks
On this instance the choice will expire nugatory – and you’ll preserve the premium as the choice is OTM. An instance is listed right here with detailed clarification.
Varsity by Zerodha
The Put Possibility promoting – Varsity by Zerodha
Perceive the Revenue & Loss, payoff whenever you quick promote a Put possibility. Perceive the breakeven level whenever you promote a put with examples
Est. studying time: 7 minutes
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On this case the put expires nugatory and also you get to maintain the premium. For the reason that premium collected is 21 per share, your breakeven level is 1879. So, even when the share drops until 1879 on expiry you’ll be able to merely sq. off the put place for no revenue or loss (after all brokerage and different expenses apply).
Simply in case the put possibility goes ITM (say value of INFY drops beneath 1879 on expiry), then you’ll be able to go for bodily settlement. However, higher is to sq. off the put at a loss and purchase the shares immediately from the fairness market. You’ll save the brokerage wanted for bodily settlement.
Your are asking whether or not the Put Possibility can be exercised.
The reply is NO.
For it to be exercised, Infosys ought to commerce beneath 1,900 on the expiry day.
Facet notice: Suppose Infy had been to commerce beneath 1,900 on the expiry day, you’d preserve the INR 21 however should take the supply of the Infy lot at 1,900 it doesn’t matter what the precise value is.
calculate margin requirement of inventory choices within the final week ?
