Comment on STT Trap - Options Expiry - NSE BSE MCX-SX

Brahmendra commented on 06 Sep 2017, 06:01 PM

Hi Nithin,

Your blogs and Zerodha materials are really wonderful. In fact, I am reading them as courses. I completed Technical Analysis and Options modules and gained lot of insights on them. Thanks a lot for all these.

Question:
I fully understood about STT and I have no questions on that. I have a question on the options that are short and expired as ITM. Scenario –
Sold one lot of Nifty 10000 CE on Day 1 and when the spot is at 9800. Say the premium paid is Rs 50. On the Day of expiry, the Spot is at 10200. Obviously the premium for 10000 CE on the expiry would be > 50 rupees (say 150). If I leave this with out buying back, what would happen to this trade.
Will I be paying (10200 minus 10000 = 200) but since I already paid the premium of 50 during short, I may end up paying 150*75. Pls clarify.

Regards,
Brahmendra

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