Comment on Basics on Options Shorting/Writing

Romeo commented on 17 Mar 2016, 02:16 PM

Dear Sir,
thank you for this amazing explanation in plain and simple language.
My query is
if i am selling an option contract, and if i do not close my position and let it be exercised at expiry, then my profit at expiry is the difference of my sell and buy premiums OR its the difference of my selling strike price and spot price at expiration…
Example…
IF i sell 100 quantity of nifty 9000 CE @ 100 and if nifty expires at 8500, then at expiry my profit will be ((100-0)X100=10000) OR ((9000-8500)x100=50000) ?
Awaiting your reply.
Thank you.

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