How cash settlement happen when you have hedge position

F&O
1

IF SOMEONE HAS POSITION AS BELOW

BUY FUTURE X JUNE
SELL ITM CALL OPTION . (SCRIP CASH SETTLED )
1 . WHAT WOULD BE EFFECTIVE MARGIN ON (LAST ) WEDNESDAY/THURSDAY )

Secondly
IF POSITION IS NOT SQUARED on expiry Day,

HOW THE POSITION WILL BE SETTLED

A. WILL IT BE NULLIFIED ( AS ONE BUY AND ONE SELL ) OR
B. FOR BUY FUTURE HE WILL GET DELIVERY AND
FOR SHORT OPTION HE HAS TO GO THROUGH AUCTION

2

Option devolves into future

Zero sum

3

Yes. but does it happen like that

otherwise

buying future will get me delivery after 2 days and for short option - it will lead to auction as i have no delivery to give

who can confirm coz no one can take risk

4

Only Index Futures and Options are cash settled, and after final settlement final profit/loss will be credited/debited from your account, there is no obligation to receive/deliver shares in cash settled F&O.

All Stock Futures and Options are physically settled and you are obliged to receive/deliver shares according to your positions, in case your positions are hedged they will be netted-off against eachother. You can read more on the Physical Settlement policy here.