Announcements

We are conducting a scheduled upgrade & maintenance activity today, 24th July 2021 from 9.30 AM to 12.30 PM to ensure that you can enjoy a seamless trading and investing experience on Upstox. During this time you may not be able to login to the Upstox mobile app & desktop platform. Thank you for your patience.

As per a SEBI mandate, physical settlement is compulsory if a trader holds a position in any Stock F&O contracts on expiry date.

What is physical settlement?
In a Stock F&O contract, when there is an open position that has not been squared off by its expiry date, physical settlement takes place. This implies they have to physically give/take delivery of Stocks to settle the open transactions instead of settling them with cash.

Examples of physical settlement:

Future

Long positions of 1 lot of Reliance, 250 quantity at Rs. 2000 i.e. Rs. 5 lakh contract value

F&O = 20% charges i.e. Rs. 1,00,000. This means, you are required to give Rs. 1 lakh, but if you decide to physically settle then you need to have a complete contract value of  Rs. 5 lakhs.

Short positions of 1 lot Reliance 250 quantity at Rs. 2000 i.e. Rs. 5 lakh contract value

F&O = 20% charges i.e. Rs. 1,00,000. This means, you are required to give Rs. 1 lakh, but if you decide to physically settle then you need to have the holdings of 250 quantity of Reliance and Rs. 1 lakh margin money till expiry date.

Option

Long - 1 lot of Reliance, 250 quantity for strike price of Rs. 2000 Call (CE) Options.

If the underlying price of Reliance is greater than the strike price of Rs. 2000, then the contract is said to be ITM (In-The-Money). If you wish to go for physical settlement, you need to maintain a free ledger balance of Rs 5 Lakh in your account, else physical settlement would not be done.

Long - 1 lot of Reliance, 250 quantity for Strike price of Rs. 2000 Put (PE) Options.

If the underlying price of Reliance is lesser than strike price of Rs. 2000, then the contract is said to be ITM (In-The-Money). If you wish to go for physical settlement, you need to provide the Stocks (shares) equal to the lot quantity positioned to be available in Demat account, else physical settlement would not be done.

Please note -- 

• Short ITM PE options, treatment would be similar to Long ITM CE options.
  Free ledger balance equal to the contract value to be maintained.
• Short ITM CE options, treatment would be similar to Long ITM PE options.
  Holdings shares of lot quantity positioned to be available in Demat account.

What is the process for Physical Settlement on Upstox?
To opt for physical settlement on Upstox, you need to provide your consent first and here are the details for the same:

• To provide your consent for physical settlement of open Stock F&O contract(s) with July-2021 expiry visit the ‘Profile’ section on your Upstox account on our App / Web and give your consent from here before EOD on Tuesday, 27th July 2021.
• Based on your consent, Upstox will evaluate whether your position qualifies for physical settlements and if there is sufficient  ledger balances / holdings (whichever applicable) is available.
• Kindly, plan your trades keeping in mind that you will not be able to trade in fresh positions in the current July-2021 expiry F&O contracts from Wednesday, 28th July 2021 onwards. 
• Correspondingly, position conversion(s) on carry forward of any stock futures positions shall also not be permitted.

What other impact could this have on your positions?
Your position will automatically be squared off in case:

• You have not provided your consent for physical settlement
• You provided your consent for physical settlement and do not have Ledger Value (equal to contract value) / holdings available for the physical settlement of your positions.
• In a case of funds / holdings not being available for all the open positions, we will execute square offs for all the positions. Thus no partial funds / holdings evaluation for the expiring positions will be considered by our team.

What else to keep in mind?
Delivery margins would be applicable as per Exchange norms on all the existing long ITM (In The Money) stock option positions in a staggered manner as explained below:

• 10% of delivery margins computed on expiry -4 days EOD (Friday)
• 25% of delivery margins computed on expiry -3 days EOD (Monday)
• 45% of delivery margins computed on expiry -2 days EOD (Tuesday)*
• 70% of delivery margins computed on expiry -1 day EOD (Wednesday)*

• To avoid margin shortages, Upstox would be blocking such (above mentioned) delivery margins from Beginning of the Day (BOD) instead of End of the Day (EOD).
• If the positions are not squared off for any reason (e.g: non-liquidity), then the contract would have to be settled physically and you would be liable to pay the entire amount of the settlement.

* If you have opted for physical settlement, you would be required to fulfil the entire funds (contract value) / holdings requirement by EOD on Tuesday i.e. 27th July 2021.

In case of spread contracts, you are advised to provide margins for both the legs  since the risk of one leg square off by you anytime would result in physical settlement of the other leg.

Brokerage in Physical settlement:

Since there is a substantial increase in effort and risk to settle these F&O positions resulting in physical delivery, if F&O positions result in physical delivery brokerage will be 0.25% of the physical settled value. For all the netted off positions brokerage will be 0.1% of the physical settled value. All physical settled contracts (Futures & Options) will also carry an applicable Exchange charge.

And that’s all. Keep a watchful eye on this page for more updates from Upstox!

On account of Bakri Id, markets will be closed on Wednesday, 21st July 2021. Trading will resume on Thursday, 22nd July 2021.

MCX will be closed on Wednesday, 21st July 2021 for the morning session. The second session (5:00 PM to 11:30 PM) will take place as usual.

Please note: All fund withdrawal requests placed on Wednesday will be processed on Thursday, 22nd July 2021.

HINDPETRO Limited conducted a meeting with its Board of Directors on 20th May, 2021. As per this meeting, it has declared, to the Exchange, a Final Dividend of Rs.22.75 per equity share. The record date for the purpose of payment of dividends is 8th July 2021.

What are dividends?
A dividend is a part of the company's profits given to its shareholders to reward them for their investment in the company. 

How does this corporate action impact Futures & Options Contracts?

Impact on Futures Contract: 

1. Base price of the Futures contracts on 8th July 2021 will be reference rate less aggregate amount of dividend i.e. Rs. 22.75 /-

2. The reference rate to be reckoned for this purpose shall be the daily mark to
market settlement price of the relevant futures contract

Impact on Options Contract: 

1. The full value of dividend i.e. Rs. 22.75 /- would be deducted from all the cum-dividend strike prices on the ex-dividend date

2. The details of the old and corresponding new options contracts shall be available for trading from 8th July 2021 and you will be notified on that day

For all positions taken before 8th July 2021, you may see a slight deviation in the carried forward (c/f) average price of HINDPETRO due to the corporate action mentioned above.

To know more, read the circular here.

As per defined limits on creating watchlists on Upstox, you can only have a maximum of 20 watchlists and 100 symbols/stocks per watchlist at a time.

If you exceed these limits, the extra watchlists and symbols/stocks per watchlist get deleted. And only the first 20 watchlists and first 100 symbols/stocks per watchlist will appear on your Upstox account.

Hence, we request you to create watchlists keeping the limits in mind.

We apologize for any inconvenience caused and thank you for your patience.