Divergence Explained with Clarity

Option Trading in India: Settlement and Expiry

In India, options are European-style, meaning they can only be exercised on the expiry date (unlike American options, which can be exercised anytime).
Most traders don’t hold options till expiry — they square off (buy or sell back) before expiry to realize profits or cut losses.

Expiry cycles:

Index Options (like NIFTY/BANK NIFTY): Weekly and Monthly expiries.

Stock Options: Monthly expiries only.

The settlement happens in cash; there’s no physical delivery for index options, while stock options can have physical settlement at expiry.