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

Thanks Shruthi. But I asked this question because I came across this article.(Link Below)

https://support.zerodha.com/category/trading-and-markets/margins/margin-leverage-and-product-and-order-types/articles/policy-on-physical-settlement

In this under the section, ‘Policy regarding Close to Money contracts (CTM)’, it says that the option wont get exercised and the contract will become worthless if the margin balance is below 50% of Contract value + profit. Am I understanding this right or am I missing something? It would be helpful if you could answer this.

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