With all due respect
@AW10
@Danpickup
@Smart Trade and all Traderji Gurus
Please bear with me.
Moderators please let the thread alive for few weeks.
It's the same old strategy or may be the most idiotic option strategy tried by lot many of people at some point of time. There are also some threads on it.
STRATEGY
Select a stock that is at resistance or support and breakout is imminent.
Buy Call and put ATM/ITM same strike price
Put Limit prices daily on both Call and Put. Limit price should be equal to total premium paid.
PROFIT BOOKING
Four conditions:
a) 5-6% jump within 4-6 trading session easily reaches above mentioned limit price on one leg. Now one can book profit on the other leg.
b) One can continue to hold second leg if bounce back or reversal is likely.
c) When a strong trend is obvious on one side (supported by other indicators), one can continue both positions.
d) 2-3% jump - one leg gains more than the loss of the other leg. Book profit on one and loss on the other.
MERITS
Loss limited
No fear of gap up down/ Fluctuations
Gain may be huge depending upon how correct one is in determining trends
DEMERITS:clap::clap::clap:
Its a slow poison. Time decay is worst enemy. Waiting for a breakout is real frustrating.
Losses from both legs bought in the first week of a contract may be as high as 20-25k by third week if no directional movement seen.
After a good movement due to low volumes one may not be able to sell at desired price (In contrast to futures)
No experts recommend it due high failures.
WHY THIS STRATEGY
Seen some profits in last one month. Lets c if it continues. There won't be any back testing. Only looking forward.
SOME OTHER RELEVANT POINTS
No fresh positions after 20th for same contract month.
Entry preferably after 3 pm and at a time when the script is stable.
Both leg entry simultaneously with as little delay as possible.
WARNING :
Do not put your money in this strategy if you don't know what you are doing.
I am doing it at my risk. No one to blame!!!
Last Trades done by me:
JP associate:
Entry 07 March- strike 47.5 call@ 2.15
Put@ 2.70
max loss-4.85x8000=38800
Exit 11 March call @5.10
put @ 1.35
Realized Profits- 12800
Maruti:
Entry 18 March -Strike 1900 [email protected]
Strike 1850 put@35
max loss: 18200
Exit 20 March strike 1900 [email protected]
strike 1850 [email protected]
Realized Loss - 3850
Power Grid:
Entry 20 March- Strike 100 call @1.25
Put @1.00
max loss-2.25x4000=9000
Exit 21 Mach- Call @2.25
put @0.35
Realized profits- 1400 closed early
Hindustan Unilever:
Entry 24 march April series -Strike 580
Call @19.30
Put @ 10.45
max loss-14875
Exit 31 March Call @34.9
Put @4.85
Realized Profits-5000
@AW10
@Danpickup
@Smart Trade and all Traderji Gurus
Please bear with me.
Moderators please let the thread alive for few weeks.
It's the same old strategy or may be the most idiotic option strategy tried by lot many of people at some point of time. There are also some threads on it.
STRATEGY
Select a stock that is at resistance or support and breakout is imminent.
Buy Call and put ATM/ITM same strike price
Put Limit prices daily on both Call and Put. Limit price should be equal to total premium paid.
PROFIT BOOKING
Four conditions:
a) 5-6% jump within 4-6 trading session easily reaches above mentioned limit price on one leg. Now one can book profit on the other leg.
b) One can continue to hold second leg if bounce back or reversal is likely.
c) When a strong trend is obvious on one side (supported by other indicators), one can continue both positions.
d) 2-3% jump - one leg gains more than the loss of the other leg. Book profit on one and loss on the other.
MERITS
Loss limited
No fear of gap up down/ Fluctuations
Gain may be huge depending upon how correct one is in determining trends
DEMERITS:clap::clap::clap:
Its a slow poison. Time decay is worst enemy. Waiting for a breakout is real frustrating.
Losses from both legs bought in the first week of a contract may be as high as 20-25k by third week if no directional movement seen.
After a good movement due to low volumes one may not be able to sell at desired price (In contrast to futures)
No experts recommend it due high failures.
WHY THIS STRATEGY
Seen some profits in last one month. Lets c if it continues. There won't be any back testing. Only looking forward.
SOME OTHER RELEVANT POINTS
No fresh positions after 20th for same contract month.
Entry preferably after 3 pm and at a time when the script is stable.
Both leg entry simultaneously with as little delay as possible.
WARNING :
Do not put your money in this strategy if you don't know what you are doing.
I am doing it at my risk. No one to blame!!!
Last Trades done by me:
JP associate:
Entry 07 March- strike 47.5 call@ 2.15
Put@ 2.70
max loss-4.85x8000=38800
Exit 11 March call @5.10
put @ 1.35
Realized Profits- 12800
Maruti:
Entry 18 March -Strike 1900 [email protected]
Strike 1850 put@35
max loss: 18200
Exit 20 March strike 1900 [email protected]
strike 1850 [email protected]
Realized Loss - 3850
Power Grid:
Entry 20 March- Strike 100 call @1.25
Put @1.00
max loss-2.25x4000=9000
Exit 21 Mach- Call @2.25
put @0.35
Realized profits- 1400 closed early
Hindustan Unilever:
Entry 24 march April series -Strike 580
Call @19.30
Put @ 10.45
max loss-14875
Exit 31 March Call @34.9
Put @4.85
Realized Profits-5000
Last edited: