General Trading Chat

XRAY27

Well-Known Member
may be your yesterday's post apply for today :lol::p
Today baba nifty is going with morning brushing (only brush is moving in the mouth)

 
@Smart_Trade

I think you made a typo on your above post. Having the 7900 put and then selling the same amount of 7600 puts will give you a credit spread and not a debit spread as you must have received more money from the shorts compare to the what you paid for the long 7900 puts. Only if you lost quit a few on the 7900 puts, then may you even got less back with the 7600 puts, and then it would be no typo.

Edit: There was a confusing from my side, as I did look at different matrix's and not checked for a moment that I did look on the wrong side in the Nifty matrix. Still, I let the above be as it is, as some more posts on the topic are coming, which cleared that.

Any way: The above has no impact on the next steps ST did and the risk profile can be imagined by looking at it:

After you toke out some long puts you had this http://www.optionseducation.org/strategies_advanced_concepts/strategies/short_ratio_put_spread.html which is one of your favorite strategies. :)

And just to visualize in a simple way your next step with the long put otm, you then had a risk profile at end which did look like the following but just with other numbers:



Have a nice day / Dan :)
 
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pareshR

Well-Known Member
Not possible to share the exact thought process until I give exact trades, levels etc and now I think it is not right to post all those as it is against the rules.

I can give the basic idea without going into levels, profits made etc.....As the market was in downtrend. I bought a 7900 puts....later because of my illness it was not possible for me to sit infront of the computer and monitor the trade as I was running high fever and the risk was if Gov Rajan cuts the rates by larger than expected, then the market would have taken a upswing and I would have lost on puts premiums...so I sold 7600 puts just to recover some premium....so it was a debit spread using puts...

As the markets went down, I booked profits on some 7900 puts and converted the spread trade into ratio spread..( took some additional protection of deep out of money puts at small premiums just to protect in case of crash scenario )and when the market was not going down, squared off the entire position giving profits....

As it is an old trade now, the above details will be sufficient to get the idea.No great strategy or system or anything...just trade management.

Smart_trade
Hello Sir

No great strategy or system or anything...just trade management.

very simple words explained but its deep more then iceberg.
thx
 

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