Why Bank Nifty option premium reduces ?
Prof Suhasini (1732 Points)
16 February 2023
Why Bank Nifty option premium reduces ?
11 Replies
Eswar Reddy S
(CFO- at NHTF)
(58275 Points)
Replied 16 February 2023
Option premium reduces or enhances based on the bank nifty direction.
Need not decrease everytime
Need not decrease everytime
Prof Suhasini
(1732 Points)
Replied 16 February 2023
I mean to say even if the market doesn't move , option premium reducing by next day
Eswar Reddy S
(CFO- at NHTF)
(58275 Points)
Replied 16 February 2023
That is due to time decay ( Theta : Option Greek)
Eswar Reddy S
(CFO- at NHTF)
(58275 Points)
Replied 16 February 2023
Options will be having expiry like weekly , monthly etc on every Thursday. So it is quite natural that the option premium falls when day closes the market at flat
Prof Suhasini
(1732 Points)
Replied 16 February 2023
Even if market closes with the previous closing, Why the premium is reducing?
Eswar Reddy S
(CFO- at NHTF)
(58275 Points)
Replied 16 February 2023
Read the previous answers again and you may understand
Prof Suhasini
(1732 Points)
Replied 16 February 2023
Some times option premium is becoming zero on the last day
Eswar Reddy S
(CFO- at NHTF)
(58275 Points)
Replied 16 February 2023
If the option goes out of the money then option premium can become zero
Dhirajlal Rambhia
(SEO Sai Gr. Hosp.)
(180927 Points)
Replied 16 February 2023
Old wine in new bottle...
Refer:: Bank Nifty Option Trading - Shares & Stock (caclubindia.com)
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