Hope some experienced member will answer. What will happen to short position in case there are no buyers till expiry day. JPassociates with lot size of 68000 had bids of 5 paisa day before yesterday for the Rs 10 put option. Today there are no bids but only offers (Only sellers but no buyers). I was tempted to sell the option at 5 paisa but was unsure. So did not take the trade. What would have been my fate if I sold the option at 5 paisa day before yesterday? I am prepared to buy 68000 shares at rs10 or less and will keep the required money in the account. If it does not come to ten rupees on expiry, I will be happy with the return of 3400/- less brokerage which will work out to about 2% per month. Kindly let me know what would have been the situation in case I took position.
If there are no buyers, there is no way a person can exit it. All options in India are european, that means they can be exercised only on last day. So whatever value stock closes below Rs 10, u get that back. If it closes above, you lose the entire money.
Suggest you to read through this, start with the futures module http://zerodha.com/varsity/
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