What is Physical Settlement in Equity Derivatives (Futures & Options) and How to Place Order in 5paisa?

What is Physical Settlement in Equity Derivatives (Futures & Options) and How to Place Order in 5paisa?

The physical settlement means if you hold a position in any Stock F&O contract, at expiry, you will be required to give/take delivery of stocks. The physical settlement is restricted only to stock derivatives. Physical settlement of index options is not applicable. Index contracts are cash-settled only. For more information on how to place a request for Physical Delivery in Futures and Options (F&O), please click here.

    • Related Articles

    • What is the concept of Physical Settlement in Equity Derivatives?

      The concept of physical settlement in equity derivatives was introduced by SEBI in July 2018 and made mandatory from October 2019 expiry onwards all the stocks. F&O physical settlement was introduced because Indian derivatives markets are one of the ...
    • Can I place VTT order in derivatives?

      Yes, you can place a VTT (Valid Till Triggered) order in derivatives, but only in equity derivatives. Steps to Place a VTT Order in Derivatives on 5Paisa Mobile Application: Step 1: Login and Select the Derivative Contract Login to Your 5Paisa ...
    • What is 5Paisa's policy on the physical settlement of equity derivatives on expiry?

      As F&O contracts approach their expiry date, the margins required for these contracts increase to align with the contract value. This is because physical settlement involves the actual delivery of the underlying stock, necessitating higher margins to ...
    • How to place request for physical delivery of Futures and Option position?

      Requesting physical delivery of Futures and Option positions involves following a structured process within the trading application. Here's a step-by-step guide: 1. Open the 5paisa Mobile App. 2. From the menu, select “Books.” 3. Choose “Position” ...
    • What is physical delivery?

      Understanding Physical Delivery in Derivatives Trading Physical delivery refers to the actual transfer of the underlying asset—such as stocks, commodities, or bonds—when an options or futures contract reaches its expiration. Unlike cash settlement, ...