Options settlement rules
- Options guides
1. Call options
Upon exercise (either in advance or upon expiration), if the settlement price is less than or equal to the exercise price, no payment will be made to the user.
Upon exercise (either in advance or upon expiration), if the settlement price is greater than the exercise price, the payment = the amount of your order * (settlement price-exercise price).
Case:
A user bought an American call option (5-minute term) with an exercise price of 56,000 and an order amount of 0.1 BTC.
a. If the user chooses to exercise the right in advance, the payment to the user is as follows:
The settlement price is 55,000, which is less than the exercise price, so no payment is made.
The settlement price is 57,000, which is greater than the exercise price, so the payment = 0.1 * (57000-56000) = 100USDT
b. If the user chooses to exercise the right upon expiration, the payment to the user is as follows:
The settlement price is 55,000, which is less than the exercise price, so no payment is made.
The settlement price is 57,000, which is greater than the exercise price, so the payment = 0.1 * (57000-56000) = 100USDT.
2. Put options
Upon exercise (either in advance or upon expiration), if the settlement price is greater than or equal to the exercise price, no payment will be made to you.
Upon exercise (either in advance or upon expiration), if the settlement price is less than the exercise price, the payment = the amount of your order * (exercise price - settlement price).
Case:
A user bought an American put option (10-minute term) with an exercise price of 56,000 and an order amount of 0.1 BTC.
a. If the user chooses to exercise the right in advance, the payment to the user is as follows:
The settlement price is 57,000, which is greater than the exercise price, so no payment is made.
The settlement price is 55,000, which is less than the exercise price, so the payment = 0.1 * (56000-55000) = 100USDT
b. If the user chooses to exercise the right upon expiration, the payment to the user is as follows:
The settlement price is 57,000, which is greater than the exercise price, so no payment is made.
The settlement price is 55,000, which is less than the exercise price, so the payment = 0.1 * (56000-55000) = 100USDT.
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