I wanted to understand where the price which an option is based on is derived from.
Example: The Japan 225 cash may be at 29000
But the Daily Options are based on a value 29040
Then say at expiry, if the CFD Japan 225 closes at 29000, the 29000 Call should be zero or very close. But it settled at 30 ITM.
So the question what is the settlement basis of Daily options for Indices such as the Japan 225?