writing covered call


#1

If i write a covered call and have the stock held in the demat of Zeroadha, do i get some advantage in terms of the margin that i need to pay for the call position.

since it will be a covered call do i need to put in margin the call goes in the money

Regards
Shekhar


#2

Hey @shekhar007

Irrespective of whether you hold the stock or not when you short options you need to have the required margins (SPAN + Exposure), it will be collected upfront.


#3

You could pledge your shares and write calls on it… the move up in stock should offset m2m loss in case it goes ITM…


#4

Thanks Kshiteesh/Shyam,
So the margin can come from the borrowing against stock - what will be the rate of interest. any other costs
Are there any cost for pledging the shares.

regards


#5

Pledging will be Rs 60 per pledge request. No charges for un-pledging.

Interest will be charged only in case of shortfall. Check out this article to know how it works.