Options Square Off

A

amitvjog

New Member
#1
#1
Dear All,

I am Amit Jog, recently started trading in options. I have a question on options here it goes...

Can I square off my Bought Call Option position before expiry with different strike price. I do not want to enter into assignment or Exercise situation.

I take a sample case here for my understanding.

Case - Call options bought Strike Price 100/- @ premium Rs. 10/- CMP 95/- lot size 100

At the time of squre off ( just before expiration)
Scenario 1 - CMP 190, call options of strike price 110/- and above are liquid.
I squared off the position @strike price 110/- @ premium 90/-

Scenario 2 - CMP 40, call options of strike price 70/- and below are liquid.
I squared off the position @strike price 20/- @ premium 20/-

In both the cases what would be my Profit/ loss.

Can any body tell me with calculations. Or i simply cannot square off position with different strike price.


Regards,

Amit Jog
 
rajeabc

rajeabc

Well-Known Member
#2
#2
amitvjog said:
Dear All,

I am Amit Jog, recently started trading in options. I have a question on options here it goes...

Can I square off my Bought Call Option position before expiry with different strike price. I do not want to enter into assignment or Exercise situation.

I take a sample case here for my understanding.

Case - Call options bought Strike Price 100/- @ premium Rs. 10/- CMP 95/- lot size 100

At the time of squre off ( just before expiration)
Scenario 1 - CMP 190, call options of strike price 110/- and above are liquid.
I squared off the position @strike price 110/- @ premium 90/-

Scenario 2 - CMP 40, call options of strike price 70/- and below are liquid.
I squared off the position @strike price 20/- @ premium 20/-

In both the cases what would be my Profit/ loss.

Can any body tell me with calculations. Or i simply cannot square off position with different strike price.


Regards,

Amit Jog
Click to expand...
Amit,
your profit or loss would be

Profit/Loss = Premium got after sell -Premium Paid when bought

Say if you paid premium 30 per stock for 100 stocks = premiums paid =3000
If you sold it at 40 per stocks for 100 premium got = 4000
profit= 4000-3000

But I would like to advise you one thing.. If you don't know then better don't play in FnO. I have seen people loosing in lakhs in Options. It looks very attractive to get double or triple money in few days but number of those days are so less to wipe your whole capital..
Or first read..

rest is your wish.. because it is your money.
 
SwingKing

SwingKing

Well-Known Member
#4
#4
@Rajeabc

I think You n I were typing at the same time.

Din know you were suggesting something. Hence pointed the user towards options thread.

Tc
 
A

amitvjog

New Member
#6
#6
Thanks dear All,

I have done just one call option trade with decent profit but do not want to go in hurry behind money.........thanks rajeabc for the advice...

My plain question was If squaring off call means selling
with same strike price or strike price is not mattered while squaring off.

if yes how it is calculated....

Amit
 
rajeabc

rajeabc

Well-Known Member
#7
#7
amitvjog said:
Thanks dear All,

I have done just one call option trade with decent profit but do not want to go in hurry behind money.........thanks rajeabc for the advice...

My plain question was If squaring off call means selling
with same strike price or strike price is not mattered while squaring off.

if yes how it is calculated....

Amit
Click to expand...
Amit , you can square off what you had bought .. You can not change strike price..
 
You must log in or register to reply here.
Thread starter Similar threads Forum Replies Date
N Explore Enhanced Options Strategy Analysis- Backtest Expired Options W/O Downloading From NSE Websites 6
T Need Help USDINR Options not squared off on Expiry. Options 0
D How to buy / square off huge quantity of BNF/NF Put or Call options Options 15
A Question on Options Square Off Options 3
M Reg. Options Square off on expiry day Options 6

Similar threads