Auctus
  • Getting started
  • Security
  • FAQ
    • Basics
    • Exercising Options
    • Minting Options
    • Security, Fees and Governance
  • AUCTUS POOLS
    • POOLS
  • Auctus Vaults
    • Auctus Vaults
  • Use Cases - Ethereum Options
    • Buying ETH call options
    • Writing ETH call options
    • Buying ETH put options
    • Writing ETH put options
  • SMART CONTRACTS
    • Factory
    • Token
    • Flash Exercise
    • Writer
Powered by GitBook
On this page
  • How to Exercise a Call Option? ( traditional )
  • How to Exercise a Call Option? ( Flash Exercise )
  • How to Exercise a Put Option?
  • How to Exercise a Put Option? ( Flash Exercise )
  • What happens to my option if I never sell or exercise it?
  • Do I have to manually exercise the options?

Was this helpful?

  1. FAQ

Exercising Options

How to Exercise a Call Option? ( traditional )

"Exercising a call" means you are demanding to buy the crypto asset at the strike price. In order to exercise the option, you must send the tokens and the corresponding amount of the strike price, before the expiration. This can be done by accessing "Manage" in the top menu of your dashboard. Example: Exercising 2 "ACO ETH-2000USDC-C-26JUN20-0800UTC"

Action

Amount

You send

2 tokens + 4000 USDC

You'll receive

2 ETH

How to Exercise a Call Option? ( Flash Exercise )

By using Flash Exercise to exercise call options, instead of sending the amount required to exercise, this amount is covered using Uniswap V2 Flash Swaps and you'll receive the remaining amount (intrinsic value) in ETH. Net Profit = Number of Options * (( Uniswap Price - Strike Price ) / Uniswap Price ) Example: Exercising 2 "ACO ETH-2000USDC-C-26JUN20-0800UTC" and Uniswap Price = 2500 USDC.

Action

Amount

You send

2 tokens

You'll receive (total profit)

0.4 ETH (2*(2500-2000)/2500)

How to Exercise a Put Option?

"Exercising a put" means you are demanding to sell the crypto asset at the strike price. In order to exercise the option, go to you must send the tokens and the corresponding amount of the underlying asset, before the expiration. This can be done by accessing "Manage" in the top menu of your dashboard. Example: Exercising 2 "ACO ETH-2000USDC-P-26JUN20-0800UTC"

Action

Amount

You send

2 tokens + 2 ETH

You'll receive

4000 USDC

How to Exercise a Put Option? ( Flash Exercise )

By using Flash Exercise to exercise put options, instead of sending the amount required to exercise, this amount is covered using Uniswap V2 Flash Swaps and you'll receive the remaining amount (intrinsic value) in USDC. Net Profit = Number of Options * ( Strike Price - Uniswap Price ) Example: Exercising 2 "ACO ETH-3000USDC-C-26JUN20-0800UTC" and Uniswap Price = 2500 USDC.

Action

Amount

You send

2 tokens

You'll receive

1000 USDC (2*(3000-2500))

What happens to my option if I never sell or exercise it?

Once an options contract expires, the token itself is worthless. If you own an option and it expires unexercised, you no longer have any of the rights inherent in that contract and you lose the premium you paid for it.

Do I have to manually exercise the options?

YES. Options are not exercised automatically.

PreviousBasicsNextMinting Options

Last updated 4 years ago

Was this helpful?