Folks
Today evening when I was looking at options data of RIL for March expiry, it struck me that 920 CE closed at Rs 26 and March Fut closed at 926. (Lot size 1000).
Let us say, on Fri (24/2) the market opens flat and one can but RIL fut at 926 and sell 920CE at 26 and hold it till expiry then it can result in the following: -
(Margin reqd is 1.8 L).
1. If expiry is at or above 920 then profit will be 20k (i.e. cool 11% in one month).
2. If expiry is between 920 to 900 then profit will linearly reduce from 20k to zero.
3. Loss start only with expiry below 900.
Plan B: It will be even safer if 900CE is sold at 39. Max profit will be limited to 13k (i.e. 7%) but loss will start only below 887.
Is anybody doing this? This can be done every month with a large cap stock which is either sideways or up-trending? Highly suitable for those in full time job or business.
(Q: For March is ONGC better bet then RIL?)
Thanks in advance
pos_trader
Today evening when I was looking at options data of RIL for March expiry, it struck me that 920 CE closed at Rs 26 and March Fut closed at 926. (Lot size 1000).
Let us say, on Fri (24/2) the market opens flat and one can but RIL fut at 926 and sell 920CE at 26 and hold it till expiry then it can result in the following: -
(Margin reqd is 1.8 L).
1. If expiry is at or above 920 then profit will be 20k (i.e. cool 11% in one month).
2. If expiry is between 920 to 900 then profit will linearly reduce from 20k to zero.
3. Loss start only with expiry below 900.
Plan B: It will be even safer if 900CE is sold at 39. Max profit will be limited to 13k (i.e. 7%) but loss will start only below 887.
Is anybody doing this? This can be done every month with a large cap stock which is either sideways or up-trending? Highly suitable for those in full time job or business.
(Q: For March is ONGC better bet then RIL?)
Thanks in advance
pos_trader