What happens in the day of expiry of F&O?

General
1

Does it go down or go up in that day?

1 Like
2

The derivative contracts are settled with respect to their underlying spot prices.

3

Suppose Nifty is closed at 7500 points on expiry day,position of BUY CALL strike price 7400(one lot 75 nos) will fetch Rs.75*100=Rs.7500.In this case you are in the money.However you have to sell the position to avoid excessive taxation.If you have position SELL CALL STRIKE 7400,you have to incur loss of Rs.7500 per lot.

BUY CALL POSITION STRIKE PRICE < NIFTY=PROFIT=NIFTY-STRIKE

BUY CALL POSITION STRIKE PRICE > NIFTY= WORTHLESS

BUY PUT POSITION STRIKE PRICE < NIFTY=WORTHLESS

BUY PUT POSITION STRIKE PRICE > NIFTY=PROFIT=STRIKE-NIFTY

SELL POSITIONS status is opposed as above.