Lets say that I buy a nifty option and pay a premium of 20,000 to the seller.
Now, if I sell a that option for a profit for 10k,
Will I get back the premium or am I in a loss of 10k (20k - 10k) ?
SO, did I loose 10 k ??
You’re earning a profit of Rs. 10,000. So when you square-off your position, you’ll be receiving a total premium of 30,000, the difference between your buy price and sell (square-off) price will be your net P&L.
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Are selling at Rs10000 or Rs 30000??
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The above example states buying at Rs. 20,000 and selling at Rs. 30,000 which results in Profit = Rs 10,000.