Can I exercise Nifty option before expiry date?

#1
Hello Friends,
I am new in Options.

My position is buy on Put for NIFTY May 6000.00 @ Prem value 20. Now its trading at 5971 @ prem value 75.

My query is do I need to wait for expiry date to exercise/square off my position or can I do it now also, as right now I am in profit.

As I heard Index options can only be exercised on expiry.

Please advise.

Thanks.
 

DSM

Well-Known Member
#2
You can sell before expiry and square off your position.

Hello Friends,
I am new in Options.

My position is buy on Put for NIFTY May 6000.00 @ Prem value 20. Now its trading at 5971 @ prem value 75.

My query is do I need to wait for expiry date to exercise/square off my position or can I do it now also, as right now I am in profit.

As I heard Index options can only be exercised on expiry.

Please advise.

Thanks.
 

ashu1234

Well-Known Member
#3
You can square off the option by selling it to book your profit. Exercising is different thing. Index futures are European option denoted by PE/CE which automatically get exercised by exchange on the expiry date, means you'll get the value of your option as Strike price +/- Spot price of the underlying. Exercising happens in American options, on NSE (stocks) which is PA/CA, which means you can take delivery of the underlying stock by exercising your option, in that case you take delivery of shares and not the profit differential.
 
#5
You can square off the option by selling it to book your profit. Exercising is different thing. Index futures are European option denoted by PE/CE which automatically get exercised by exchange on the expiry date, means you'll get the value of your option as Strike price +/- Spot price of the underlying. Exercising happens in American options, on NSE (stocks) which is PA/CA, which means you can take delivery of the underlying stock by exercising your option, in that case you take delivery of shares and not the profit differential.


Please tell me if I sold NIFTY OPT 30APR 15 CE @ 8250 at 42.75 Rs and on expiry its price is 52. If i dont squareoff this position, what will be my max loss.
 

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