Question

7. If you sold a call option at a strike price of Rs 800 and received a premium of Rs 30,000 and if the stock price went up to Rs 1000 on expiry what is your net loss/ profit considering 1 Market lot= 1000 shares.

Answer 1

Given :  sold a call option at a stock price of Rs 800 and received a

premium of Rs 30000 .  the  stock price went up to Rs 1000 on  expiry

To find :  what is  net loss/ profit  considering 1000 Shares

Solution:

Stock Price  = Rs 800

Number of Shares = 1000

Premium = Rs 30000

Selling Price = 800 * 1000 + 30000    =  800000 + 30000

= 830000

Stock Price went up  Rs 1000

Value  = 1000 * 1000  = Rs 1000000

Loss = 1000000 - 830000 = 170000  Rs

Loss % = (170000/1000000) * 100 = 17 %

Loss of 17 %  =  170000  Rs

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