Please can anyone tell what will happen in the following situation?
Eg:- Suppose, A bought a call at a strike price of Rs 500. On expiry the price of the asset is Rs 450. A will not exercise his call. Because he can buy the same asset from the market at Rs 450, rather than paying Rs 500 to the seller of the option.
So, in the above example, since A is not exercising his call, will there be a penalty on him?
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P.S. :-Can anyone suggest a good book about Futures & Options which describes things in a layman's language with examples to understand things better about F&O.
Eg:- Suppose, A bought a call at a strike price of Rs 500. On expiry the price of the asset is Rs 450. A will not exercise his call. Because he can buy the same asset from the market at Rs 450, rather than paying Rs 500 to the seller of the option.
So, in the above example, since A is not exercising his call, will there be a penalty on him?
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P.S. :-Can anyone suggest a good book about Futures & Options which describes things in a layman's language with examples to understand things better about F&O.
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