@ShubhS9 or any other ,I need your help.
I have a hedged position in Sunpharma
420 PE Long
560 PE Short(ITM)
590 CE Short(ITM)
680 CE Long
I need to know what happens to the margin requirement for the last week of December expiry. Will my both ITM comes under net-off scenario and I no need to worry or I should square off. I am totally tight on margin.
Subrat, even of your position is hedged, margin requirements for Short positions will increase to twice of SPAN + Exposure margin on last two days of expiry, though you will continue to get margin benefit.
335k, This is margin requirement to hold Short positions, you are also getting margin benefit of 143k, bringing your total margin requirement down to 192k.
On last two days of expiry, your margin requirment for Short positions will increase to twice of SPAN + Exposure margin requirement (335K * 2 = 670k), on this 670k you will continue to get margin benefit of 143k as this is hedged position, so your total margin requirement will be 527k (670k - 143k margin benefit).
You also need to keep in mind that exchange charges Physical Delivery Margin for Long ITM Options in phased manner from expiry minus 4 days, so if any of your Long Option position becomes ITM, on that as well there will be margin blocked.
Thanks @ShubhS9 for your super nice explanation.
So if I decide to square off all my positions on Tuesday( 29th Dec -> E-2 Day) I am not getting into all these scenarios.
1- My Long calls are anyways OTM, I will square off those
2- My Short calls will be squared off before Wednesday