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June 7 is the last trading day and expiry date of the m1707 contract series of the options on the soybean meal futures (the “soybean meal options” for short), which is also the first expiry date since the trading of the options, when the positions of the July Contract of soybean meal options that have not been liquidated or exercised will expire. An official of Dalian Commodity Exchange (DCE) reminded the investors to get ready for relevant transactions or exercise.
The official said that in order to prevent the options buyers from the losses caused by forgetting to submit the application for exercise in a favorable market, DCE will adopt the automatic exercise for the mature in-the-money options, with the exercise application automatically submitted for the positions of the options with the in-the-money value greater than zero. The options with the in-the-money value greater than zero are the call options whose strike prices are less than the settlement prices of the underlying soybean meal futures contract on the day, or the put options whose strike prices are greater than the settlement prices of the underlying soybean meal futures contract on the day. At the same time, the buy side clients can also make evaluation and decide whether to exercise based on the judgment for the future trends of the underlying futures prices and the level of their own funds. If buy side clients are unwilling to exercise the right, they can cancel the automatic exercise for the positions on the trading terminal in the trading time on the expiry date.
The official also said that in order to effectively manage the futures positions after exercise (performance), DCE will inspect the funds and futures positions of the clients applying for exercise, and the clients with insufficient funds or violation of the futures position limits after exercise will not be able to exercise or will only carry out partial exercise.
