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what is Exercising Options

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  #1  
Old 23rd February 2007, 11:43 AM
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Exclamation what is Exercising Options

brother

can u tell me about Exercising Options how i can do it?

& what is hedging please tell me about it?
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Old 24th February 2007, 02:06 PM
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Default Re: what is Exercising Options

Exercising option - buying underlying commodity/stock
In india it is not possible to buy underlying. Instead the difference of closing price and strike price is paid to the client.
If your option is in the money , it is automatically exercised and the difference of price ( closing price - strike) is credited to the account. All out-of-the money options expire worthless.

You have to call your broker to place exercise call in case you want to exercise before expiry date.

When an exercise call is placed , it is randomly assigned to one of the option writer and he is obliged to pay.

Regards
krishna
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Old 24th February 2007, 08:56 PM
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Default Re: what is Exercising Options

Missed : hedge fund .
Please refer http://en.wikipedia.org/wiki/Hedging

regards
krishna
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Old 25th February 2007, 02:19 AM
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Default Re: what is Exercising Options

Quote:
Originally Posted by spattavayal View Post
Exercising option - buying underlying commodity/stock
In india it is not possible to buy underlying. Instead the difference of closing price and strike price is paid to the client.
If your option is in the money , it is automatically exercised and the difference of price ( closing price - strike) is credited to the account. All out-of-the money options expire worthless.

You have to call your broker to place exercise call in case you want to exercise before expiry date.

When an exercise call is placed , it is randomly assigned to one of the option writer and he is obliged to pay.

Regards
krishna
thank you dear
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