Is trading in Far OTM options possible on FYERS?
Yes, FYERS provides the ability to trade Far Out-of-The-Money (OTM) options with a broad strike price range. You can buy and sell options contracts that are far from the current market price, depending on the type of asset (Index or Stock).
Options Buying
Index Options:
- You can buy OTM options with a strike price within 20% of the Last Traded Price (LTP).
Stock Options:
- Similarly, for stocks, you can buy OTM options within 20% of the LTP.
Example:
If the Nifty Index LTP is 15,000, a 20% range means you can trade options between 12,000 to 18,000 strike prices (15,000 - 3,000 and 15,000 + 3,000).
Options Selling
Index Options:
- No specific strike price boundaries for selling OTM options in indices.
Stock Options:
- A 30% range is set for selling OTM stock options.
Points to Note
- Illiquidity in Deep OTM options: These options typically have lower trading volumes, which can result in higher slippage. Therefore, we strongly recommend using limit orders for these trades.
- Market Orders Restricted for Stock Options: Due to low liquidity in far OTM stock options, market orders are not allowed for such trades.
Always use limit orders when trading far OTM options to avoid execution at unfavorable prices.
What if...
| Scenario | Outcome |
|---|
| You want to buy Far OTM Index options | You can buy options up to 20% of LTP from the current price |
| You want to sell Far OTM Index options | No specific strike price limits apply |
| You want to buy Far OTM Stock options | You can buy options within 20% of LTP, but use limit orders |
| You want to sell Far OTM Stock options | You can sell within 30% of LTP, but use limit orders |
Last updated: 27 Jun 2025
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