Comment on Policy on settlement of compulsory delivery derivative contracts — Update Oct 2019

Akilan Veerabatheren commented on 07 Aug 2020, 10:24 PM

What if I have long call and long put both of which on expiry becomes ITM, am I obligated to take the delivery of shares and sell them subsequently both of which would result in huge capital pledging?

For eg if for X share I have long call for 10rs and long put for 20rs, on expiry the share is trading at 15rs, is it my obligation to buy for 10rs and sell for 15rs, for which I will be ending paying very high margins but eventually make profit?

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