Option Buy Recomendations

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SIR
Please continue your post, as usual.


Regards ,

SOM

 

[ghosh_ak34]

Dear Friends,

For Nifty Future traders who would like to trade as per trend check strategy posted in 1st post of the thread, Nifty levels for tomorrow are as under:

Resistance at 5475
Support at 5410

If you go short 1 lot then, buy 1 lot at money or near money call and if you go long 1 lot then, buy 1 lot at money or near money put to hedge. Reco. to trade as per trend check strategy posted in 1st post of this thread.

Regards

 

[ghosh_ak34]

Dear Friends,

Market is trading in narrow range 5400 to 5500 with slightly bearish sentiment. I would reco. profit booking on all long positions. Let Nifty breach 5550 convincingly and trade above it for 3-5 days atleast before we can take any further call.

Those of you who are holding Nifty Aug. 5400 straddle could keep an hold.

Regards

 

[ghosh_ak34]

Dear Friends,

For Nifty Future traders who would like to trade as per trend check strategy posted in 1st post of the thread, Nifty levels for tomorrow are as under:

Resistance at 5510
Support at 5435

If you go short 1 lot then, buy 1 lot at money or near money call and if you go long 1 lot then, buy 1 lot at money or near money put to hedge. Reco. to trade as per trend check strategy posted in 1st post of this thread.

Regards

 

[ghosh_ak34]

Dear Friends,

For Nifty Future traders who would like to trade as per trend check strategy posted in 1st post of the thread, Nifty levels for tomorrow are as under:

Resistance at 5490
Support at 5430

If you go short 1 lot then, buy 1 lot at money or near money call and if you go long 1 lot then, buy 1 lot at money or near money put to hedge. Reco. to trade as per trend check strategy posted in 1st post of this thread.

Regards

 

[rai07]

Example of the same

1. First in decline manner buy 250 nifty bees suppose ur average price for nifty bees comes at 500 means u have bought nifty at 5000.

2. After buying nifty bees sell a call of next month higher than ur average cost say of 5100 or 5000 in case of 5100 u may get 80 or 90 rs premium

3. Now say at the end of the month if nifty is 5300 nifyty bees will be 530 so u will have profit of rs 30 per nifty bees i.e 30*500=15000 and say u sold call of 5100 so call price will be 200 i.e 5100-5300=200 so loss of rs. 200*50=10000 but u will gain say conservatively 80 rs premium i.e 80*50= 4000
Summary

1. Profit of Rs 30 per nifty bees = 15000
2. Loss on call 200 per call= 10000
3. Profit on premium 4000

Net Profit 9000

Now this profit is at 5300 level profit may be up or down according to market

I will also disclose risk with it

this strategy is best for the rangebound market when the market is upwards u may gain only premium but then also return is very good if u calculate on investment

This strategy works only when the nifty i.e nifty bees is above ur average cost. if the nifty goes down ur average it is very risky to do this strategy

At last i would say in this strategy profit would be somewhat cap in upward market loss would be reduced in downward market and best in rangebound market
Members pls share ur views on the same

 

[ghosh_ak34]

Dear Friends,

For Nifty Future traders who would like to trade as per trend check strategy posted in 1st post of the thread, Nifty levels for tomorrow are as under:

Resistance at 5432
Support at 5357

If you go short 1 lot then, buy 1 lot at money or near money call and if you go long 1 lot then, buy 1 lot at money or near money put to hedge. Reco. to trade as per trend check strategy posted in 1st post of this thread.

Regards

 

[ghosh_ak34]

Example of the same

1. First in decline manner buy 250 nifty bees suppose ur average price for nifty bees comes at 500 means u have bought nifty at 5000.

2. After buying nifty bees sell a call of next month higher than ur average cost say of 5100 or 5000 in case of 5100 u may get 80 or 90 rs premium

3. Now say at the end of the month if nifty is 5300 nifyty bees will be 530 so u will have profit of rs 30 per nifty bees i.e 30*500=15000 and say u sold call of 5100 so call price will be 200 i.e 5100-5300=200 so loss of rs. 200*50=10000 but u will gain say conservatively 80 rs premium i.e 80*50= 4000
Summary

1. Profit of Rs 30 per nifty bees = 15000
2. Loss on call 200 per call= 10000
3. Profit on premium 4000

Net Profit 9000

Now this profit is at 5300 level profit may be up or down according to market

I will also disclose risk with it

this strategy is best for the rangebound market when the market is upwards u may gain only premium but then also return is very good if u calculate on investment

This strategy works only when the nifty i.e nifty bees is above ur average cost. if the nifty goes down ur average it is very risky to do this strategy

At last i would say in this strategy profit would be somewhat cap in upward market loss would be reduced in downward market and best in rangebound market
Members pls share ur views on the same

Dear rai07,

Your strategy looks okay in rangebound market having Nifty moving up as assumption. This is like covered call write. NiftyBess don't fall as sharp as Nifty falls. So, one can keep a suitable SL for an exit.

It will give good ROI if this call write is done after 15th of the current month instead of next month's OTM call.

Regards

 

[rai07]

Ghosh

Thanks for posting reply

Sir i didnt undt ur meaning of selling after 15 of current month if v sell of current month premium will be less

Sir pls share ur views on risk associated with this should i execute according to u

Thanks

 

[ghosh_ak34]

Ghosh

Thanks for posting reply

Sir i didnt undt ur meaning of selling after 15 of current month if v sell of current month premium will be less

Sir pls share ur views on risk associated with this should i execute according to u

Thanks

You can write two OTM calls after 15th of the month to cover you NiftyBees buy. After 15th of the month OTM call wil start loosing its time value.

Yes, one can also write next monhs's OTM calls but risk will be higher.

Regards