Squaring off in derivatives
This query is : Open
09 July 2017
In derivatives market, is it mandatory to square off you position on expiry?Further, a call seller is also required to square off his position in a case where call buyer is not exercising the contract? What happens in that case?
09 July 2017
On expiry day i.e last Thursday of month all open F&O contracts are auto squared off if the traders/investor fails to square off. The Future contracts are settled at closing price of underlying assets. In case of call seller, if the person fails to square off his position, then settlement price depends upon whether the call option is in the money or out of the money.Further of the contracts are auto square off the trader/investor is required to pay higher STT.
10 July 2017
Thanks sirIf on expiry the call buyer is not exercising his right can the call seller simply ignore the contract?
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