I saw today around 3.27 PM, Nifty was around 13740 and I saw that 24DEC NIFTY 13750 PE was trading around 2.10 /-, I was much confident that nifty will close below 13750 today (24-DEC, 2020). But I did not buy 24DEC NIFTY 13750 PE, as the STT calculation was not clear to me on the expiry day. Was it wise to buy that 24DEC NIFTY 13750 PE while it was around 2 rupees at 3.27 PM and leave it without selling? As nifty is closed today at 13739.60, so probably my profit may be (13750-13740-2)=8 x 75 =600/-, now what will be the STT on this?
*Your kind answer will be very helpful for my better understanding. Thank you. *
can you please tell me, what is about STT if I don’t sell them on the expiry day? I was in confusion with the STT on the expiry day if I don’t get any scope to sell them.
The profit is not calculated as you have illustrated above.
Keep in mind that the closing price of nifty is the weighted average of the last 30 min of the trading session.
Since you have mentioned the 24th dec expiry option, all OTM options will be worthless, price will become close to 0.
At 3:27pm, the weighted avg price of nifty was around 13749 and the nifty spot was at around 13744 and the 13750pe was trading at rs 2.
Since only 3 min are left , most positions for todays expiry would have already been squared off.
The weighted avg price would fall only if there were to be a large sudden fall because only 3 min were left.
Even in this case since the intrinsic value of the option at 3:27 is only rs 1, and you buy it for rs 2, it is highly probable that you would loose .8 at it ended at rs 1.2. Hope this helps!