Options

Ordinary purchases and sales of option contracts are registered in the same way as other purchases and sales. This page describes the special Option exercise and Option expiration events.

The option must first be created as a security of the type Option. The option type and contract size are entered in the security dialog and used as the starting point when an exercise is registered. See also the general page about options.

Option exercise

An option exercise closes the option position and simultaneously creates a calculated purchase or sale event in the underlying share.

Option, account, and underlying share

Select the option instrument, the account containing the position, and the share delivered or received on exercise. The underlying share must already exist as a security.

Date and time

Enter the date on which the exercise should be included in the calculation. The time determines its order relative to other events on the same day.

Generated share event

Select whether the exercise should create a Purchase or Sale of the underlying share. AksjeFiks suggests the direction based on the option type and whether the open option position is long or written, but you must check the selection against what actually occurred on exercise.

The usual direction is:

• long call: purchase of the underlying shares
• written call: sale of the underlying shares
• long put: sale of the underlying shares
• written put: purchase of the underlying shares

Number of contracts and contract size

Enter the number of option contracts exercised and the number of underlying shares covered by each contract. The dialog shows the calculated number of underlying shares:

number of contracts × contract size

If the contract size changed after a corporate action, the value in the exercise event must match the actual terms at exercise.

Exercise amount

Enter the total amount paid or received for all the underlying shares on exercise, in the exercise currency. This field is therefore not the exercise price per share.

Select the exercise currency and check the exchange rate to NOK. The dialog shows the exercise amount converted to NOK.

Share price at exercise

Enter the market price per underlying share at exercise, together with the share price currency and exchange rate. AksjeFiks multiplies the price by the number of underlying shares and displays the market value in NOK.

The exercise amount and market value are used to calculate the option position’s value when it is closed. The generated share event uses the market value as its total purchase or sale amount.

Comments

There is one comment for the closing option event and a separate comment for the generated share event. Suggested comments are created when you select the option and underlying share, but they can be changed.

What is created on exercise?

For calculation purposes, AksjeFiks creates two parts:

1. The option position is closed at the calculated exercise value. If the position is written, the closing is treated in the opposite direction from a long position.
2. A purchase or sale is created in the underlying share with a quantity based on the number of contracts and the contract size.

The generated share event appears in the event list but should not be edited directly. Edit the option exercise if, for example, the direction, quantity, amount, market price, or underlying share is incorrect.

Option expiration

Use an option expiration when an open option expires worthless and no underlying shares are delivered.

Select the option and expiration date. The dialog shows the number of open contracts that will be closed. The entire open position is closed at a value of zero, so the premium from the earlier option trade is included in the calculated result.

If only part of the position expired, earlier purchases and sales should be registered so that the open quantity on the expiration date corresponds to the part that actually expired.

Checks after registration

After an option exercise, check both the option and the underlying share. After an option expiration, the option holding should be zero. Also check that the result, number of contracts, number of shares, currencies, and dates agree with the broker documentation.