Physical settlement in stock futures and options means settling contracts by transferring actual stocks instead of cash. When a contract expires, if you choose physical settlement, stocks will be delivered to or from your demat account as per the contract terms.
Groww typically settles all F&O positions in cash upon expiry. However, if you opt for physical settlement, ensure you have the required margin balance one trading day before expiry. You can request physical settlement on the Groww platform.
Key Points for Physical Settlement:
- Margin Requirements: Sufficient margin is required, particularly for long in-the-money (ITM) options, with increasing requirements as the expiry approaches.
- Applying for Physical Settlement: Request through Groww and ensure sufficient funds to meet margin needs.
For a complete understanding of physical settlement, refer to Groww's detailed guide.