Say, I sell a CE ATM option and on the expiry day it became ITM. Assume, it is very deep ITM and there is buyer for me to close the trade. In this case, what will happen. How does Zerodha close it ?
@Jason_Castelino @Stonecold @tallerballer
Depends on which option you are holding. Index options expiring ITM are settled by the exchange at the intrinsic value.
If it’s stock option, you will have to give/take delivery of underlying shares if option is ITM.
Have explained this here: What happens if I don't square off my positions in options? - #2 by ShubhS9
Will there be any penalty/charges ??