Index ITM money Settlement – #2 by ShubhS9 – F&O – Buying and selling Q&A by Zerodha

Verifying margin shortfall penalty from NSE - #16 by Hardeep - General -...


If somebody has purchased a CE deep ITM in nifty and we see that as a result of deep ITM, the unfold is large between purchaser and vendor as a result of much less liquidity.
Now, on expiry if we exit the CE by promoting, we’d lose cash as the customer could be at 100 rupee much less.
So, we don’t exit the deep ITM CE Purchase.
How will the alternate settle it then? Who can pay me equal to the Intrinsic Worth?
Within the settlement course of, can I nonetheless lose 100 ruppee as dealer would possibly need 100 ruppee from me after the settlement due to no liquidity and he paid to the alternate for money settlement?

Please put extra mild right here if this CASH SETTLEMENT also can grow to be harmful just like PHYSICIAL DELIVERY of inventory ITM choices?

Thanks.

Angel



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