What Is The Impact of Dividends on Average Rate for Open Positions in F&O ?

---

If you hold open positions in Futures and Options (F&O), the impact of dividends will reflect differently based on the type of dividend and the segment (Futures or Options).

Extraordinary Dividends: Click here to see the impact of extraordinary dividends.

For Futures Open Positions, the earlier average rate will no longer be displayed in the trading platforms. Instead, the new open rate of the contract, calculated after deducting the extraordinary dividend from the settlement price, will appear as the average rate. 

To check the realized profits or losses, refer to the P/L statement in MyGeojit. 

For Options Open Positions, adjustments will result in new strike prices being shown in the trading platforms. The old strike positions will be closed using the FIFO average rate. The new strike positions will be opened with the same average rate carried over from the old strikes. 

For example, a dividend was declared for Coal India. Hence, the old strike positions at Rs.395 was closed using the FIFO average rate, and the new strike positioned at Rs.384.75 was opened with the same average rate carried over from the old strike. 

Read More: What is the impact of corporate actions on F&O contracts?