Welcome to Nifty/Stock Options Teaching

Amazon Monsoon Appliances Sale: These must be identical in terms of the underlying scrip and maturity date and strike price to the ones that you have sold. We offer option trading, commodity brokerage, futures trading, brokerage services in India. Depending on the availability in the options market, you may be able to buy a call option of Reliance at a strike price of at a time when the spot price is Rs That said, remember that you will start making profits only once the Nifty crosses 6, levels, since you must add the cost incurred due to payment of the premium to the cost of the index. In the derivatives market, you may want to Buy shares or Sell them at a specific price in the future. Zerodha - India's first discount broker offering the lowest, cheapest brokerage rates in the industry.

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A call option helps you fix the buying price. This indicates you are expecting a possible rise in the price of the underlying assets.

So, you would rather protect yourself by paying a small premium than make losses by shelling a greater amount in the future. As we read earlier, the buyer of an option has to pay the seller a small amount as premium.

Seller of call option has to pay margin money to create position. In addition to this, you have to maintain a minimum amount in your account to meet exchange requirements. Margin requirements are often measured as a percentage of the total value of your open positions. Let us look at the margin payments when you are buyer and a seller:.

Remember, while the buyer of an option has a liability that is limited to the premium he must pay, the seller has a limited gain. However, his potential losses are unlimited. The margins are levied on the contract value and the amount in percentage terms that the seller has to deposit is dictated by the exchange. It is largely dependent on the volatility in the price of the option. Higher the volatility, greater is the margin requirement. So, the seller of a call option of Reliance at a strike price of , who receives a premium of Rs 10 per share would have to deposit a margin of Rs 1,16, How to settle a Call Option: When you sell or purchase an options, you can either exit your position before the expiry date, through an offsetting trade in the market, or hold your position open until the option expires.

Subsequently, the clearing house settles the trade. Such options are called European style options. Let us look at how to settle a call option depending on whether you are a buyer or a seller. There are two ways to settle — squaring off and physical settlement. If you decide to square off your position before the expiry of the contract, you will have to sell the same number of call options that you have purchased, of the same underlying stock and maturity date and strike price.

When you square off your position by selling your options in the market, as the seller of an option, you will earn a premium. The difference between the premium at which you bought the options and the premium at which you sold them will be your profit or loss. Some also choose to buy a put option of the same underlying asset and expiry date to nullify their call options. The downside to this option is that you have to pay a premium to the put option writer.

Selling your call option is a better option as you will at least be paid a premium by the buyer. If you have sold call options and want to square off your position, you will have to buy back the same number of call options that you have written. These must be identical in terms of the underlying scrip and maturity date and strike price to the ones that you have sold.

In this section, we understood the basics of Options contracts. In the next part, we go into details about Call options and Put options. Mon to Fri — 8. Existing customers can send in their grievances to service. No need to issue cheques by investors while subscribing to IPO.

Just write the bank account number and sign in the application form to authorise your bank to make payment in case of allotment. No worries for refund as the money remains in investor's account. Kindly note that as per NSE circulars nos: We have taken reasonable measures to protect security and confidentiality of the Customer Information. Infinity IT Park, Bldg. Skip to main content. Account Login Not Logged In. What are Call Options: Here are some key features of the call option: You will also have to specify how much you are ready to pay for the call option.

The strike price for a call option is the fixed amount at which you agree to buy the underlying assets in the future. It is also known as the exercise price. When you buy the call option, you must pay the option writer a premium. This is first paid to the exchange, which then passes it on to the option seller. You sell call options by paying an initial margin, and not the entire sum.

However, once you have paid the margin, you also have to maintain a minimum amount in your trading account or with your broker. For a buyer of a call option: For the seller of a call option: Previous Chapter Next Chapter.

How to use “Stock Options” table?:

Stocks Options Chart for the derivative stocks with Stock Options Chain: Options Trading to help you decide which stocks to buy. Nifty Option Chain: Change in Open Interest; Nifty Put Call Ratio: Intraday Nifty PCR; Nifty Option Chain Analysis – Traded Volume; Put Call Ratio – Day Trend; Option Strategy. Nifty Option Strategy Diagram. OptionsTeaching Specialized in Teaching Option Trading Strategies like Nifty option trading, Delta neutral Non Directional Option Writing/Option Shorting Strategies and Stock Options Trading Strategies We are specialized in teaching Delta neutral Non Directional OPTION TRADING STRATEGIES which is an art of selling call options, put options. Nifty Options Call Put Intraday Trading. 1, likes · 3 talking about this. Nifty Option trading tips.