Anomaly in Option chain

Nifty & Bank Nifty discussions
1

Hi Experts!
I saw this anomaly in the option chain. I could not find an explanation myself so gathered the courage to ask the experts.

I have attached a snap of the relevant option chain (downloaded after close of trade), in case of the 19800 PE (24-2-22 expiry)

The Intrinsic value of 19800PE: (Rs.19800 - Rs.17617 = Rs.2,183)

Ask price: Rs. 2122.85

which means negative time value of Rs. 60
Is it possible to have negative time value ,does that easy money?

Thanks in advance

Exception
Exception1200×317 41.5 KB

2

illiquid contracts can have wide bid/ask spreads.

3

Hi Joyesh! thanks for the reply. I don’t think low liquidity is the reason in this case. In this case, a person was willing to write an option at lower than intrinsic value (that too way deep in the money). What if it was bought and held till expiry-easy money.

4

Hi @Hemant_Prasad, most likely wanted to get out of their long position.

5

Yeah, can’t think of anything else. Funny part is that the bidder was not willing to pay that also. Options are indeed risky ( in all sense of the term)

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