What is the impact of Corporate actions on futures and options? Check DOC if we can use with Dinesh sir

Corporate Actions and Contract Adjustments:

Tradejini understands that corporate actions, such as Bonus, Rights, Extraordinary dividends, Merger/Demerger, Amalgamation, Splits, and Consolidations, play a significant role in shaping the futures and options contracts of the underlying stock. Our commitment is to ensure that market participants’ positions retain value as close as possible to the original value on the ex-date of the corporate action. To learn more, visit nseindia.com/products-services/equity-derivatives-corporate-actions-adjustments.

To achieve this, adjustments are made, encompassing changes in the base price, option strike values, and market lot, depending on the adjustment factor. In certain situations, adjustments may lead to the modification of the contract’s expiry date. This means that the contract could be force closed before the original expiry date, and adjusted contracts will be introduced for trading instead.

The specific adjustments needed will vary based on the nature of the corporate action. It’s important to note that all open positions will be subject to these adjustments. This is done to maintain fairness and consistency in the market, ensuring a level playing field for all traders.

Stay informed about all current and upcoming corporate actions by referring to our comprehensive list (DOC)