@Vikii
Good evening bro.
Hope you get out of this situation in least possible damage…
Please go through physical settlement for fno stocks before your next trade in stock options dear…
This auction stuff really is not a very pleasant thing…
Please study in detail before next trades bro… otherwise it can really burn your hands…
Have a great trading journey ahead…
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Thanks brother 
Really appreciate.
tell me one thing how to avoid damage or loss… will it work if i somehow able to buy shares from open market?
will this avoid any loss?
or it is confirm that i will be in 20 or 40% loss
Please go through physical settlement for fno stocks before your next trade in stock options dear…
will this avoid loss?
Thank you very much… wish you best of luck in trading and life as well… REally appreciate it.
@Vikii It is clear from your posts that you don’t even understand if short CE results in give delivery or take delivery obligations and what the process for the same is. I would really advice you stay out of options till you have understood all of this. Otherwise you are just waiting for a big disaster to happen.
But coming back to what will happen in this case, you will most likely only have a small loss due to following:
- The 0.25% brokerage charged by Zerodha + STT etc. for physical delivery obligations, i.e. around Rs. 2000 per lot. Might be even higher than this due to auction.
- The auction price in theory can be upto 20% higher, but for highly liquid stocks like Hindalco, you can expect a small markup only. The real risk in your case is not the auction itself, but rather what will be the price of Hindalco in normal Monday trades. If Hindalco is flat or negative, then you will largely escape unscathed (but please note that if Hindalco is very much in the Red on Monday and the auction price is less than Thursday price, the benefit will go to Investor Protection Fund, not you). On the other hand, if Hindalco is say up by 4%, then expect auction price to be at a slight markup to this. You will have to bear this 4% + markup cost.
Not to mention, that the original trade was profitable for you, as you shorted at 12.7 but the fair value at expiry was only Rs. 2.25 (567.25 minus 565), so that profit you still keep, and it is possible that overall you didn’t lose on this trade, but do take learnings from this as it could have been far worse.
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Thank you very much Brother. Yes still not very much aware of many things and i was little worried about this 20% ckt… i was little aware that it is highly liquid stock but was not aware of auction things…
and happy to hear and quite please to hear that loss wont be much…
just one more query…do i need to do anything on monday like buying same number of qty at start of market?
Really appreciate your answer. Thanks a lot
Thanks Vikii. Please excuse me if I was too direct in asking you to be very careful, but I will be happy if my advice saves you from any future big problem in derivatives.
As mentioned in the thread above, you need to deliver the shares on Monday, but if you buy on Monday they will be available on Tuesday, so it is of no use… You could in theory do offline transfer of shares to your Demat somehow by Monday morning, but I’m not sure how you will find someone to do the same. So, you do nothing, and let the exchange process of auction kick-in automatically on Monday afternoon. You will get to know by late Monday or Tuesday, that at what price you got the shares in the auction (you will receive contract note by Zerodha). Hope Hindalco will be range-bound and you won’t lose much.
I believe you did not close your position at expiry time because the fair value was Rs. 2.25 but the contract was trading at Rs. 8? It happens sometimes… these are games played by institutional players… You could have bought the shares on Thursday afternoon itself as an alternative, or you could have bought the Hindalco Jan Futures just before expiry (which would have counter-balanced the give delivery from 565 CE), but both these methods required extra margin availability which I’m not sure if you had at that moment.
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No issue…thanks for being straight fwd. I am still not aware of many issue and i know my mistakes very well but still failing to follow rules and disciplines. Had many big losses due to few issues
Yes you are right its fait value was less so i thought it will get execute at lower price and i failed to closed trade. I should have closed all in afternoon
Going to stop stock option trading completely and will buy for lokg term only luckily last momth very well in stock optin trading may b overconfidence cause this isse.
Any way will take precaution from next time.
I hope i will get hindalco in 1-2% range…
Thanks you very much once again. really appreciate 
it
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Hey his Skrike price is 565 and the closing price is 567.7, which is very near.
Will he not get an option for cash settlement first since the closing price is near the strike price? I had read for near 5 strike prices, the person will get an option for cash settlement i.e (567.7 - 565) * no of lots
@ShubhS9 Can you please help here?
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The Do Not Exercise facility was discontinued by the exchange after introducing net settlement facility. Have explained about it in detail here: Net settlement of trades across cash segment and F&O segment upon expiry of stock derivatives
Also, will get 17,780 Rs as he is a seller (1400*12.7)?
Yes…but hubdalco is highly liquid stock so i feel thr wont be much issue. But i have never seen auction data so not sure. Only on monday i will know price hope it willl be close tomkt price
Hey, I have been actively participating in the auctions markets and what I have usually seen is that the final settlement price in auction markets is very close to the market price at that time. So, lets say if hindalco trades in market at a price of 575 during the auction then its likely to be settled near 575-585 in the auction markets (as its highly liquid). Being said you don’t have to worry about paying 20% higher than the market price
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Thanks shivansh…yes same thing mentioned by dcd.
I am fine with 1-2% here and thr…may be hindalco will move up and cangive profit as well
And yes i was woried about 20% …but after replies from you guys…quite relief now and yes have to avoid such cases in future…
Yes. The premium received from selling options is credited to the account on the day the option is sold.
Thanks for explaining this with utter patience and depth, I was going thru the thread it was a learning for me as well @Pai
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did you get it settled bro? how did it go…can you share the update
No not yet…hindalco closing price yest and today as well is almost same…hoping auction price wknt be more thab2% but u dnt have any idea initially i was assuming 20% but thats not case as said by few other member as it is nifty stock
Will.update once i get stocks
FYI guys
i received contract note and as per it i received shares at - 581
not good experience guys i will say avoid stock trading in last day or stop it completely in last 3-4 days 
Difference of 2.5 % not big it was unnecessary closing on same day would have save good amount