15% Guaranteed Returns - Buy both Call & Put options Strategy

[hkashikar]

That's fantastic information for the beginners and I appreciate and thank you all for sharing it.

However the main part to execute this is to choose the right stock where most of us (new beginners) fail and book loss.

For e.g. Call option ASHOKLEY OPT 27NOV 14 CE @ 57.5 - LTP is 0.15 while for same stock put option LTP is 4.75 showing no movement.

It will be great if someone can enlighten us on how to select right stocks so that the return is really guaranteed.

Thank you
Harshad Kashikar

 

[naveen3562003]

Found this article in wiki- so actually my question is how many of us here are following long straddle strategy?

A long straddle involves going long, i.e., purchasing, both a call option and a put option on some stock, interest rate, index or other underlying. The two options are bought at the same strike price and expire at the same time. The owner of a long straddle makes a profit if the underlying price moves a long way from the strike price, either above or below. Thus, an investor may take a long straddle position if he thinks the market is highly volatile, but does not know in which direction it is going to move. This position is a limited risk, since the most a purchaser may lose is the cost of both options. At the same time, there is unlimited profit potential.[1]


For example, company XYZ is set to release its quarterly financial results in two weeks. A trader believes that the release of these results will cause a large movement in the price of XYZ's stock, but does not know whether the price will go up or down. He can enter into a long straddle, where he gets a profit no matter which way the price of XYZ stock moves, if the price changes enough either way. If the price goes up enough, he uses the call option and ignores the put option. If the price goes down, he uses the put option and ignores the call option. If the price does not change enough, he loses money, up to the total amount paid for the two options. The risk is limited by the total premium paid for the options, as opposed to the short straddle where the risk is virtually unlimited.

thanks for the great info....I am still beginner

 

[APPD1972]

I am being able to making money with long strangle formula since 2005. Time decay not affected to me because I get position on the expiry day of previous settlement, hence I have 18-22 days in hand. In this time frame you get 300-500 Nifty movements surely.

 

[vittal]

Dear Sir,

What % of return u r getting from long strangle? please reply me ..N what about time decay?

Regards
Vittal:clap:

 

[hmp]

I am being able to making money with long strangle formula since 2005. Time decay not affected to me because I get position on the expiry day of previous settlement, hence I have 18-22 days in hand. In this time frame you get 300-500 Nifty movements surely.

Pl. tell us in detail about your strategy, means do you purchase ITM or OTM ? Further for strike price what rule you follow etc.
Regards.

 

[APPD1972]

Expecting more or less 30% earnings per month. That I purchased 8550 CE (DEC)@96 & 8500 PE (DEC) @92, when Nifty Futures was on 8525-8530 27.11.14, that mines total premium I spend 188. If Nifty crosses 8750 (higher probability) or down below 8300 you get your profit starting. But you need expertise to do that if you need more significant profit. I already sold my PE Option contract @65 because market is surely in uptrend, purchase PE again if it sleeps below 8475. Disclaimer- Obviously risk associate with it as you trading in stock market. But I get 9/10 times profit of 12 months.

 

[trader_ks]

Thanks for your post. Does this apply to Nifty options, especially the part where you mention that OTM options could be fatal; if I understood it right.
Of course, I my physical age in 65 but trading age is just a couple of months.
So pardon if I have erred.

Hi Niceman,
Yes it is applicable on Nifty option as well. My one cent advice on Nifty is that almost all the brilliant minds and algo machines plays with Nifty. So chances of losing money in OTM Nifty is much more than scripts.
So I prefer to handle Nifty with below 2 strategies.
a) Future and option combination.
b) Using spreads

 

[abb24]

Can u suggest the strategy with current example for 15% return in options or combination of future and option with one week time frame.
Thanx in advance

ABB24

 

[abb24]

Dear Sir

Can u pl explain me yr SH 315 strategy. I shall be grateful to u.

Regards,

ABB24

 

[Karanm]

What Stop Loss do you keep because in case you win 9 out of 12 Trades but without a Stop loss it can be NO PROFIT NO LOSS STRATEGY.