Low Risk Low Returns- Target 50 NF per month per NF Lot

[healthraj]

Bear PUT: 75PE-74PE=35;

Will enter take 3 or 4 of these at diff points. If market goes down, will seek to buy Bull Calls. Eventually, I hope to trap the price so that one of the two closes ITM.

Hi Amit,

When you say 75PE-74PE, Do you mean you will Sell 7400PE and Buy 7500PE ?

 

[jamit_05]

Putting out a sample paper trade as follows:

Buy July NF @ 7686; (Spot 7636) lots 15
Buy Aug 76PE @ 167 lots 30;

This is a low risk low profit (high investment) thread, hence the objective will be relatively watered down.

Objective:

We are facing an inevitable time decay of:

50 points in NF in a month and half (July Expiry)
50*50*15 = 37500

25 points in Aug 76PE in a month
25*50*30 = 37500

Total of 75000;

Recovering this 75K is our first objective.

A suitable plan:

Will sell NF, at every 50 point rise.
Will sell PE, at every 25 premium point rise.

Our gains will come from buybacks, the difference. When price retraces, will buy them back as profit target is met and decay is covered.

Will track the present value to know profit and loss at all times.

Present Value:
7686*50*15 = 5764500;
167*50*30 = 250500;
Total: 6015000.

 

[jamit_05]

July NF (7704-7686)*50*15=13500
Aug 76PE (167-160)*50*30=-10500

Still holding. Will take some action when there is movement.

 

[jamit_05]

July NF (7596-7686)*50*15=-67500
Aug 76PE (167-205)*50*30=+57000

Delta is not exactly adjusted.

1) Sold 50 units 76PE @ 200 EOD

 

[praveen taneja]

July NF (7596-7686)*50*15=-67500
Aug 76PE (167-205)*50*30=+57000

Delta is not exactly adjusted.

1) Sold 50 units 76PE @ 200 EOD

You selling naked puts ??? $ and crude can make worst weekend is always problem creator but you know pros and cons too i know god bless us all:thumb:

 

[jamit_05]

You selling naked puts ??? $ and crude can make worst weekend is always problem creator but you know pros and cons too i know god bless us all:thumb:

Selling from inventory. This is low risk low returns thread

 

[jamit_05]

July NF (7596-7686)*50*15=-67500
Aug 76PE (167-205)*50*30=+57000

Delta is not exactly adjusted.

1) Sold 50 units 76PE @ 200 EOD

Sold 50 units 76PE @ 216

 

[healthraj]

Putting out a sample paper trade as follows:

Buy July NF @ 7686; (Spot 7636) lots 15
Buy Aug 76PE @ 167 lots 30;

This is a low risk low profit (high investment) thread, hence the objective will be relatively watered down.

Objective:

We are facing an inevitable time decay of:

50 points in NF in a month and half (July Expiry)
50*50*15 = 37500

25 points in Aug 76PE in a month
25*50*30 = 37500

Total of 75000;

Recovering this 75K is our first objective.

A suitable plan:

Will sell NF, at every 50 point rise.
Will sell PE, at every 25 premium point rise.

Our gains will come from buybacks, the difference. When price retraces, will buy them back as profit target is met and decay is covered.

Will track the present value to know profit and loss at all times.

Present Value:
7686*50*15 = 5764500;
167*50*30 = 250500;
Total: 6015000.

Hi Amit,

If you are planning to get profit out of Premium and time value, I did not understand the idea of Buying.

So i did not understand your strategy.

Can you explain a bit more ?

If it is only options then I could have told you using my Options Strategy calculator on what would be the Profit If NIFTY is at 7800 or When NIFTY is at 7400.

But in this I am not able to.

 

[trader_ks]

Hi amit
I think this is not a low risk stratagy.
if I understand correctly you are planning to sell pe at every 25 point rise and future at every 50 point gain.
Seeing current global situation market may make a huge dip.PE premium will be increased at very low rate compared to futures losses. In that case what is your backup plan??

 

[jamit_05]

Hi amit
I think this is not a low risk stratagy.
if I understand correctly you are planning to sell pe at every 25 point rise and future at every 50 point gain.
Seeing current global situation market may make a huge dip.PE premium will be increased at very low rate compared to futures losses. In that case what is your backup plan??

Have bot 15 lots of NF
And bot 30 lots of PE. This is pretty much delta neutral. Market dips are not a worry.

Currently, daily is trending up. So, it makes sense to sell PEs at 25 pts gain and recover them at the next rise, which is likely since Daily is trending up.