Ideally, If u see a trend developing early.... then stagger the sell....
Like if u see the market selling off... then sell the call first and then at the end of the day...sell the put.... that way you get an extra premium.
if you play with nifty, then i suggest u short a straddle. preferably, 3500 straddle as there are plenty of resistance above this...3518, 3536, 3576...
Look at it this way, imagine the nifty as a rubber band, which has been stretched. Now if we sell a straddle at 3500 and we want a direction away from 3500. At this point, either the rubber band snaps and nifty breaks all the resistances and goes up to 3800 then these levels then act as support or it succumbs to the selling pressure and sells off and goes to test 3300-3290 support and hopefully break it go & down the drain. we dont care.
doesnt matter which direction the rubber band goes, as long as it is away from our 3500 level we will be smiling.
trust me, this strategy is tough. I paper traded this for over 2 months and then put it to trade last month at 3100 straddle. Last month was lucky. This month's 3400 too, the trend was strong and that helped. But in case the trend dries up and market goes volatile around the strike price, then we have to re-think the strategy.
in case u want to play safer, I suggest 3400 put and 3600 call then u sell nifty below 3400 and buy nifty above 3600. the strategy remains the same, but u relax between 3400 and 3600 and watch the strangle decay slowly.
what ever u do.... remember its your money and the risk is yours. You gain money, you can thank me, but incase u screw it up, you can abuse me, but by then your money is already lost. No strategy is too good to be true.
Its not what you play but how you play that dictates the profit.
Like if u see the market selling off... then sell the call first and then at the end of the day...sell the put.... that way you get an extra premium.
if you play with nifty, then i suggest u short a straddle. preferably, 3500 straddle as there are plenty of resistance above this...3518, 3536, 3576...
Look at it this way, imagine the nifty as a rubber band, which has been stretched. Now if we sell a straddle at 3500 and we want a direction away from 3500. At this point, either the rubber band snaps and nifty breaks all the resistances and goes up to 3800 then these levels then act as support or it succumbs to the selling pressure and sells off and goes to test 3300-3290 support and hopefully break it go & down the drain. we dont care.
doesnt matter which direction the rubber band goes, as long as it is away from our 3500 level we will be smiling.
trust me, this strategy is tough. I paper traded this for over 2 months and then put it to trade last month at 3100 straddle. Last month was lucky. This month's 3400 too, the trend was strong and that helped. But in case the trend dries up and market goes volatile around the strike price, then we have to re-think the strategy.
in case u want to play safer, I suggest 3400 put and 3600 call then u sell nifty below 3400 and buy nifty above 3600. the strategy remains the same, but u relax between 3400 and 3600 and watch the strangle decay slowly.
what ever u do.... remember its your money and the risk is yours. You gain money, you can thank me, but incase u screw it up, you can abuse me, but by then your money is already lost. No strategy is too good to be true.
Its not what you play but how you play that dictates the profit.