Short Futures - Before dividend declaration

[siva-reddy]

@Suvajit_Das

So if the share is trading at 100 and gave a div of 5 Rs. Then will the next day Spot Price be adjusted to 105 or 95?

Adjusts to 95, also this is just theoretical, in normal session it can decrease more or even go up after open.

@Suvajit_Das

why was the adjustment didnt happen in NSE and our Future and Options does consider the NSE Price as SPOT Price right?

Nse didn’t do it, but futures and options will adjust to that, wondering without knowing these basic things how can you take a trade in fno risking so much capital. I would suggest you to go and give a read to varsity module on these corporate actions and it’s effects.

[siva-reddy]

@Suvajit_Das

My question is if the Options of Future Prices are adjusted then shouldn’t the Spot be also revised? I mean shouldn’t we be seeing at 8AM .i.e. before pre-opening then price of NMDC around 133-7 = 126 approx?

As mentioned above NSE don’t adjust to spot where as BSE does.

[Suvajit_Das]

Thank you Siva for the description. It all started with Zerodha Varsity only at one point of time and still learning. Thank you once again and will read about the module you suggested.