I have made a bullish butterfly on particular stock thats one call atm buy then 2 call sell at 30 points and 1 call otm buy all placed at equidistant. Suppose It goes into profit and I am unable to sell ATM which might have gone to ITM and at end of expiry i am in profit, will the position get netted off? Please revert on this doubt
If you were not able to sell the ITM call stock option, you will be obligated to take the delivery of the underlying stocks.
Ok thank you, and what if Sold Call option closes ITM and overall there is a profit. What happens in such case??
Then you need to deliver the stocks. If you have the underlying stocks not a problem, if you don’t then the broker buys the stock from the auction and delivers it on behalf of you(margin is blocked in your account). The auction price of the stock varies a lot from the market price.