Nifty aug'2010 5500 put option

Hi,

I want to know something on exercising the 5500 NIFTY PUT Option of August expiry, as many of us must have noticed that LTP for this contract was 15.65 whereas Nifty was trading near 5480 levels from 3:00 PM to 3:29 PM.

So the real value of this one comes out to be 5500-5480 = 20 Points so there was a chance to take advantage and earn 4-5 Pts easily.

Now my question is :

a ) If anyone buys the 5500 Put option @ 15 Rs per lot, will it have been profitable if he/she wishes to exercise this option

b ) What are the taxes that needed to be paid.

I tried to search nse site but enough information is not available there so I am posting the Query here.

I request all the experts to give an advice.

Thanks in Advance.

Kailash

I got nifty 5500 PE at 15.6 and I let it to expire. The settlement was 22.1 as nifty closed at 5477.9. I should have profited 6.5 rs which is 325 r per lot.


I traded 20 lots means 6500 rs profit. But in the contract not on security transaction tax column they charge around 7000rs which is ultimately loss to me.

I am using reliance money. Anyone could you plz clarify why it happened like.

I also searched in NSE site for ITM option expiry STT but could get not any information. Thanks in advance.

Regards
Aru

Value of taxable securities transaction relating to an “option in securities” shall be the settlement price, in case of sale of an option in securities, where option is exercised.

b Sale of an option in securities, where option is exercised 0.125 per cent Purchaser

That is a cut paste from the NSE site.

So thats APPROX 5580x50x0.125% per lot.