How short call profit is calculated ?
I am a novice in options and have just started learning can someone clear my doubts
1.Suppose i shorted 1 lot of nifty call at 9700(Strike price ) on 4th june 2017 paying a premium of 75 ,lets assume nifty closes at 9600 on that day ,can i sell my lot and book my profit ?
2.how much profit can i earn that day is it (75x75=5625)
or
does it depend on the premium i,e if premium traded that day is
open high low close
74.95 84.90 65.35 69.15
so will my profit be {(75-65)x75) i,e 750 rs( assuming i sell at 65 )
where am i going wrong ?
Hi Ved - looks like you need to start from basics. You should check out - https://zerodha.com/varsity/module/option-theory/. Iād suggest you start from chapter 1 and go sequentially.
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You try to understand options profit and loss diagram for expiry.
and for intra day or before expiry the premium difference will be your profit and loss.
Please follow Option Basics
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