Comfortable profits from trading Nifty.

[gmt900]

Considering another Spread, similar to which gmt has placed

Short
June 7000 CE @ 125
June 5500 PE @ 132
Total Credit: 257;

-----------
Apr 7000CE and 5500PE are quoting at 3.50 and 12, respectively. Hence, I can assume with some accuracy that this will be my cost of buyback of June contracts two months down the line. 240 points of potential profits in two months.

Our threat comes from only one fact, that if a strike becomes ATM quickly. To remedy that lets spend 15 points and buy same strike Apr contracts.

Tks GMT for bring it up.

Not too sure about this assumption. Good strategy anyway!

 

[jamit_05]

Considering another Spread, similar to which gmt has placed

Short
June 7000 CE @ 125
June 5500 PE @ 132
Total Credit: 257;

-----------
Apr 7000CE and 5500PE are quoting at 3.50 and 12, respectively. Hence, I can assume with some accuracy that this will be my cost of buyback of June contracts two months down the line. 240 points of potential profits in two months.

Our threat comes from only one fact, that if a strike becomes ATM quickly. To remedy that lets spend 15 points and buy same strike Apr contracts.

Tks GMT for bring it up.

Adding a condition to the above bolden:

Provided anytime after a month and half, Nifty comes back to the same price range.

 

[kisalay]

Appreciate everybody's efforts in deriving strategies here, but one forgets the fact that there's a huge May event of Elections and possibly a hung parliament. God forbid, a hung parliament will wipe out one entire side and one may end up looking at 4500 PE or lower. 7000 CE despite all the optimism around really looks highly unlikely - because of the global economic scenario and reports from Davos, where India found little takers for the growth story.

There are some interesting strategies here and I would like to see if I can begin paper trades with some of them :thumb:

 

[Option.Trader]

Adding a condition to the above bolden:

Provided anytime after a month and half, Nifty comes back to the same price range.

Interesting strategies here, but is this repeatable or one off due to higher IV in June due to preceding elections. Do you think this could be the case in June for September series? Generally if you can get 400 points in a year by writing, you can double your margin amount used in writing constant lots

 

[jamit_05]

Interesting strategies here, but is this repeatable or one off due to higher IV in June due to preceding elections. Do you think this could be the case in June for September series? Generally if you can get 400 points in a year by writing, you can double your margin amount used in writing constant lots

Hi OT,

Long time. Hope u've been enviably progressing as a trader. Best Wishes.

This is very naive of me to expect returns so easy, no matter how small, from the markets. In reality, I wish to learn how to take judicious risks while trading options. Long way to go.

IV is likely to play spoilsport in this trade. I may have to sell some more when IV spikes.

 

[tatyawinchu]

Hi OT,

Long time. Hope u've been enviably progressing as a trader. Best Wishes.

This is very naive of me to expect returns so easy, no matter how small, from the markets. In reality, I wish to learn how to take judicious risks while trading options. Long way to go.

IV is likely to play spoilsport in this trade. I may have to sell some more when IV spikes.

Hey,
What is the current sum total of your trade on each call and the sum total?

Also, I need to read more about time decay and IV .. which resources would u suggest?

Basically my thought pattern of theory crafting a trade was the same, "take premium in hand, use that premium to protect the call" as the skeleton system.

thanks.

 

[jamit_05]

Progress so far has been such:

I realize that if I wanted to sell Strangles/Straddles, then I should sell at such levels so that those levels will be revisited before price trails far-off; So what are those levels?

1) In an uptrend, price goes up strongly away from daily ema15. Sell EOD. Price is very likely to touch the ema, and come back up as the trend is still up.

2) Daily pivot highs in an uptrend. Most of these pivots are not broken clean, price often comes back to re-test.

This can be done on weekly and daily.

Keeping a wide SL as we will be aiming for a very good strike rate.

 

[jamit_05]

As a follow-up of the thought process, hv sold

100 units of 63/62 @ 74/57;

SL is 10%. Rs.1300; 13 points.

My expectation is that the price will touch Daily e15 and then come back up, spending atleast 3 days and a weekend in the process.

 

[sanjeev258380]

As a follow-up of the thought process, hv sold

100 units of 63/62 @ 74/57;

SL is 10%. Rs.1300; 13 points.

My expectation is that the price will touch Daily e15 and then come back up, spending atleast 3 days and a weekend in the process.

I am not getting ur this commment
Can i explain

 

[jamit_05]

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