Query on profit booking in options trade

General
1

If i have bought a call option at a premium of 20 rs, & after 8-10 days it is trading at a premium of 36 rs, expiry is about 1 week ahead, how can I book my profit and close my position before expiry?

2

Yes you can book profit or loss any time during market hrs

3

I am making a profit of 16 rs on a lot of around 400 (6400/-). If i sell my position tomorrow and book profit, will I be considered as an option seller ? do I need margins to sell my position? will I be exposed to a risk of unlimited loss if there is a big movement in stock price and stock settle’s below the strike price of my call option, on the day of expiry?

4

no…

5

Here you are exiting (squaring off )your existing open buy position .it is not treated as a fresh sell and hence no margin needed!!

6

He is trading option without knowing such a simple thing! Now i know why most option trader loss money. Option is the most risky instruments
It demands polished skills. You should atleast go through varsity.

1 Like
7

Thanks for your comment.
Would like to bring in your kind knowledge that I am doing only paper trading in options to understand the things practically.

8

Thanks for replying. Concept is clear now.

9

Thanks for your reply.