What happens if I don't square off my positions in options?

F&O
2

Index Options (Nifty and Bank Nifty, Nifty Financial Services) are cash-settled.

  • If your Option expires OTM, it expires worthless.

  • ITM Options are settled at their Intrinsic Value.

And depending on your Profit/Loss money will be credited to / debited from your account.

Also, if your Long Option position expires ITM, exchange will levy STT at 0.125% on the intrinsic value. There will be no STT on the Short position as STT is already paid when you sell the option. More details here:

Stock Options are Physically Settled.

  • If your Option expires OTM it expires worthless.

  • If your Option expires ITM it will be physically settled and you will be obliged to Recieve or Deliver shares depending on your position, you can read more on physical settlement here.

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