How is the margin for buying and selling options determined in the stock market?

How is the margin for buying and selling options determined in the stock market?

For buying either calls or puts, the margin requirement is equivalent to the premium.

Margin for buying options = Premium x Total Quantity
The option seller, facing a higher risk, has an increased margin requirement. The exchange determines this based on the underlying asset's volatility. To know the margins for different contracts, refer to our margin calculator.

For example, Mr. Das wishes to buy a call option of Nifty50 at a ₹90 premium for 50 shares. His margin requirement becomes ₹90 (premium) x 50 (shares) = ₹4500 (Approx.).

If he opts to sell the same options contract, the margin required is ₹1,18,450 for the same 50 shares.

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