Dear Senior members,
I am new to this option trading. What is the different between buying an call option and writing call option? Please explain me on this. And also I heard that If we go short on option, on the expiry day, if we don't cover our short, then the system will cover the short automatilcally at 3.30. In that case, at what price the short will be closed. I.e. on last traded price or the difference between strike price and current price?
Let me explain the above case with the following example.
I go short on 3100 call option at some price. At the end of the expiry date, Nifty closes at 3130 and the option is traded at 25(say). Now What happens? Whether the difference between strike price and closing price of 30 will be price the system will cover the short or traded price of 25 will be covered?
I am new to this option trading. What is the different between buying an call option and writing call option? Please explain me on this. And also I heard that If we go short on option, on the expiry day, if we don't cover our short, then the system will cover the short automatilcally at 3.30. In that case, at what price the short will be closed. I.e. on last traded price or the difference between strike price and current price?
Let me explain the above case with the following example.
I go short on 3100 call option at some price. At the end of the expiry date, Nifty closes at 3130 and the option is traded at 25(say). Now What happens? Whether the difference between strike price and closing price of 30 will be price the system will cover the short or traded price of 25 will be covered?