Trading for Living -- Successfully Completed one year as Full Time Trader

[amrutham]

One good news for you : You dont need to buy shares anymore if it becomes ITM. After 2-3 months , all F&O options will be settled in physical delivery You will get the shares if your option becomes ITM. Make sure you have a enough fund when it happens

What happens If I don't have enough funds?

Are brokers going to block full amount if we short stock options?

 

[superman]

What happens If I don't have enough funds?

Are brokers going to block full amount if we short stock options?

Hmm not sure, This will be the first time in India. My guess is they wont block entire amount but if you dont have enough funds, they will still take delivery and sell it immediately on next day open and recover that difference amount from you along with all STT etc charges

 

[arunkarthik]

Hi

I’ve replied earlier, but not sure what happened to that.

Could you pls explain about this - ‘will buy shares If any position closes ITM’

I’m new to options trading and still learning it’s knacks and nuances. Thanks.


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Will buy the shares if any position closes in the Money(ITM)
meaning if PNB expires below 77.3 and TATAMOTORS below 264.5 he will purchase (take delivery of the shares for investment) at the expiry rate.

Thanks Jegan for the explanation.

Could you also kindly let me know how can I do this? I’m with Karvy. During the expiry, should I use the option ‘take delivery’ just in case if my trade goes this way? And if so, I should be having the entire funds to do it so? TIA.



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[jagankris]

Thanks Jegan for the explanation.

Could you also kindly let me know how can I do this? I’m with Karvy. During the expiry, should I use the option ‘take delivery’ just in case if my trade goes this way? And if so, I should be having the entire funds to do it so? TIA.

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Book loss in the options and buy the shares i.e take delivery[taking delivery is optional].
Yes you should have the entire fund to take delivery for CASH.
PNB lot size 4000 and TATAMotors 1500.
I am not sure about the proposed physical delivery rules check with your broker.
In future If you dont want automatic physical delivery happening book loss and close your options positions before expiry.

 

[arunkarthik]

Thanks Jegan for the explanation.

Could you also kindly let me know how can I do this? I’m with Karvy. During the expiry, should I use the option ‘take delivery’ just in case if my trade goes this way? And if so, I should be having the entire funds to do it so? TIA.

Sent from my iPhone using Tapatalk

Book loss in the options and buy the shares i.e take delivery[taking delivery is optional].
Yes you should have the entire fund to take delivery for CASH.
PNB lot size 4000 and TATAMotors 1500.
I am not sure about the proposed physical delivery rules check with your broker.
In future If you dont want automatic physical delivery happening book loss and close your options positions before expiry.

Cheers, thanks a lot.


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[amrutham]

Entered into below BN position for 07th June expiry.

BN Spot @ 26950

Sell BN 27500 CE 200 Qty @45.5
Sell BN 26000 PE 200 Qty @44

Net Credit = around 18K

This position is safe in the BN range 26000 -27500 for the next week.

Adjusted this position.

BN spot @ 26550

Buy BN 27500 CE 200 Qty @18
Sell BN 27000 CE 200 Qty @ 75

Credit = 57*200 = 11400

Net credit = around 29K

This position is safe in the range BN range of 26000- 27000 for this week.

 

[jagankris]

@amrutham,
IMO You spot bottoms (Strong SUpport Zones) very well ex Rel Comm,TATA Motors,PNB and why not go long but write Puts for a meager profit ?

 

[VJAY]

@amrutham,
IMO You spot bottoms (Strong SUpport Zones) very well ex Rel Comm,TATA Motors,PNB and why not go long but write Puts for a meager profit ?

Dear jagan,
IMO its a plan if on expiry if its closing ITM then only he take longs in cash...so he following his plans only which he planned well before entry ...one needs to follow his rules perfectly when in trade ...

 

[amrutham]

@amrutham,
IMO You spot bottoms (Strong SUpport Zones) very well ex Rel Comm,TATA Motors,PNB and why not go long but write Puts for a meager profit ?

Dear jagan,
IMO its a plan if on expiry if its closing ITM then only he take longs in cash...so he following his plans only which he planned well before entry ...one needs to follow his rules perfectly when in trade ...

Our plan is to increase the trading capital until it reaches the magic figure of 1 crore and then onwards to increase the equity portfolio with the trading profits.

Until then will only buy shares if the sold puts become ITM.

If everything goes as per plan and if no big losses in between, I think we should reach our target in the next two years.

 

[onequorauser]

Hmm not sure, This will be the first time in India. My guess is they wont block entire amount but if you dont have enough funds, they will still take delivery and sell it immediately on next day open and recover that difference amount from you along with all STT etc charges

I think this is only for illiquid FOs not for the very liquid ones. Again how will one take a delivery of an index ? I dont think the fine print for this is out quite yet