Question about Selling Call or Put

#1
Currently I allocated 10 Thousand for F & O Trade

When I am trying to sell call or put including Nifty or Stock Options It Says Your Allocated Fund is not Enough

My Broker : ICICIDIRECT

Call & Put Sellers/Writers Please Help :puke:
 

man4urheart

Well-known member
#2
You need margin as good as what you need for Futures.

Increase it to 40,000 and see you will be able to execute.

You have asked a basic question, I am guessing you planning to lose money by selling options!

Stay away from options my recommendation.
 

San Yad

Active member
#3
Currently I allocated 10 Thousand for F & O Trade

When I am trying to sell call or put including Nifty or Stock Options It Says Your Allocated Fund is not Enough

My Broker : ICICIDIRECT

Call & Put Sellers/Writers Please Help :puke:
Usually when you sell either call (CE) or put (PE) of any strike price your broker would not provide margin.

Hence you need full amount to sell any of the above.

But when you buy either one, you will get margin amount.

The percentage of margin depends on broker to broker. So you can play with.

Happy Investing!
 
#8
I don't think buyer of an option is given any margin. The margin given by the option writer is retained by the exchanges.

Am I right?

No option traders here?
You are right, option buyers don't get any margin.

When selling options, the seller must provide margin to the broker in accordance with the exchange rules.
 

man4urheart

Well-known member
#9
You are correct Alchemist.

Until you close position and if you are in profit then you get the profit payment.

The biggest issue with Indian options is that the lot sizes are so huge, that cost to sell a combination requires 100,000 in margin! If one look at options traded in US, the lot sizes are kept small to lure traders!
 
#10
The margin is blocked instantly and usually debited by the broker at the end of the same day when you sell an option,this margin amount changes daily because of the movement in the underlying stock/index and the broker credits/debits the same to/from the clients account.

The seller gets the premium credited on T+1 day basis.

The margin amount is held by the broker until the seller square's off the position or expiration of the contract,after which the broker credits the amount back net of any profit/loss.
 
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