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Old 30th September 2010, 07:31 AM
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Default Margin on Call Writing



Hello Fellow Traders,

For buying a Call Option, one has to pay only premium amount whereas for selling a Call Option, one has to maintain SPAN Margin.

I was wondering whether one can sell a call option without maintaining SPAN Margin.

Lets say, I bought a call option of ABC Co. with strike price 200 for a premium of Rs.10/-.

If I want to sell a call option with strike price 240, does any broker allow call writing without insisting on SPAN Margin.

Because, the loss on SHORT CALL is offset by LONG CALL, so I presume SPAN Margin is not required in latter case. But, my broker Sharekhan does not allow call writing at all.

Do you guys have any idea of a broker, who allows call writing (probably without SPAN MARGIN as in above example).

Regards,

Capriura
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