Low Risk Options Trading Strategy - Option Spreads

[abigbull]

i feel so. All in all, i feel option writing would be dangerous by end of next week. May be buying will be favorable. My own thinking.
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Did u mean buying in both directions and then how to capitalise if the move is downwards or upwards ?

 

[trader.trends]

Here is the Nifty Spread Table at EOD 16 April

ML = Maximum Loss
MP = Maximum Profit
RRR = Risk Reward Ratio (MP/ML)
BE = Break even point. For calls above this point is profits and for puts below this point is profits.

I have included three strikes on either side of today's close. For ease I have taken LTP and have calculated as Debit spreads only.

 

[fabrics]

here is the nifty spread table at eod 16 april

ml = maximum loss
mp = maximum profit
rrr = risk reward ratio (mp/ml)
be = break even point. For calls above this point is profits and for puts below this point is profits.

I have included three strikes on either side of today's close. For ease i have taken ltp and have calculated as debit spreads only.

is this the first time u have put this type of spread .i think it is great & hope to see more of these spreads here

thanks very much

 

[trader.trends]

SUJANATOW @ 55 BEST Short term BUY on 19th april 2010

Reasons: Increase in Promoters holding gradually

Upside Price Breakout @ 56-58 Target of 66-75

Huge Increase in volume, Technically ADX, Stocastics, RSI and MACD giving buy signal

passa

You have had a rather busy day today. You have posted the same message in 18 threads today. This is pure spamming.

 

[Karanm]

Here is the Nifty Spread Table at EOD 16 April

ML = Maximum Loss
MP = Maximum Profit
RRR = Risk Reward Ratio (MP/ML)
BE = Break even point. For calls above this point is profits and for puts below this point is profits.

I have included three strikes on either side of today's close. For ease I have taken LTP and have calculated as Debit spreads only.

Sir, is there any Statergy in which by investing we can get 50% Success Ratio and Risk / Reward Ratio of 1:2 (Risk 1 & Reward 2). As AW10 Sir have mentioned in the begining of this thread that there is Risk of 47/- & Reward of 100/-. I will Prefer Trading once in a settlement, once in a month, say at the first day of a new Settlement. I have been searching for Statergy in which after 10 Trades, I get 500/- in 5 Trades and I loose 250 in 5 Trades, So ultimately you get 250/- at the end of 10 Trades. Sir, can you or AW10 Sir or any other member can suggest any Statergy.
Regards
Karanm

 

[fabrics]

Here is the Nifty Spread Table at EOD 16 April

ML = Maximum Loss
MP = Maximum Profit
RRR = Risk Reward Ratio (MP/ML)
BE = Break even point. For calls above this point is profits and for puts below this point is profits.

I have included three strikes on either side of today's close. For ease I have taken LTP and have calculated as Debit spreads only.

What is the nifty close u have taken?

 

[trader.trends]

What is the nifty close u have taken?

Fabrics

Spreads are directional trades. YOU decide using your knowledge about the market, where the market is headed. If YOU think the market is going to be bearish in the short term, you take the put spread, if YOU think the market is going to be bullish you take the call spread.

Here let me list the thought flow required before you initiate the spread trade.

1. Decide the direction you think the market is headed.
2. Decide the length of market rise/fall that you expect in your direction
3. Look at the various spreads available for your target of Nifty. If you think the market will go down till 5200 only, then the 5300-5200 spread, If you think the mkt will head to 5100 then you have the choice of 5300-5200, 5300-5100 and 5200-5100 spread.
4. Look at the RRR for each of the spread available to you. Choose the one that you are comfortable with.
5. Initiate the trade.

Remember that the greater the RRR the lesser the probability of that event happening. Keep the probability of the even happening always in focus and then initiate the trade. There is no method to calculate the probability of an even happening in the mkt. That assessment has to come with experience. Also in spread trades we calculate the RRR with expiry in mind but there is absolutely no compulsion to wait till expiry. You can exit anytime you have enough profit or want to cut the losses if the trade did not go in your direction.

The above table does not in any way decide on expiry figure for the Nifty. That is for you to decide and take the trade.

 

[trader.trends]

Sir, is there any Statergy in which by investing we can get 50% Success Ratio and Risk / Reward Ratio of 1:2 (Risk 1 & Reward 2). As AW10 Sir have mentioned in the begining of this thread that there is Risk of 47/- & Reward of 100/-. I will Prefer Trading once in a settlement, once in a month, say at the first day of a new Settlement. I have been searching for Statergy in which after 10 Trades, I get 500/- in 5 Trades and I loose 250 in 5 Trades, So ultimately you get 250/- at the end of 10 Trades. Sir, can you or AW10 Sir or any other member can suggest any Statergy.
Regards
Karanm

Karan

Why be stuck on a fixed RRR of 1:2? In the table above Ii have listed many trades which have excellent RRR. There are many excellent strategies listed in this forum: Saint's, Pride's Columbus's Savant's, Linkon's, Radha's and of course this thread by AW10. Undoubtedly there are many more I have not listed. There is no shortage of strategies in this forum. You are spoilt for choice here. It is for you to choose what you will be comfortable with. You have to define what kind of a trader you want to be (intraday, positional, long term, only futures, option trader, etc) then you have to choose the strategy that fits with your pocket, time and personality.

I prefer to trade less (no patience to see growing and diminishing two-coloured candles) and hence spreads are my choice.

 

[Karanm]

Karan

Why be stuck on a fixed RRR of 1:2? In the table above Ii have listed many trades which have excellent RRR. There are many excellent strategies listed in this forum: Saint's, Pride's Columbus's Savant's, Linkon's, Radha's and of course this thread by AW10. Undoubtedly there are many more I have not listed. There is no shortage of strategies in this forum. You are spoilt for choice here. It is for you to choose what you will be comfortable with. You have to define what kind of a trader you want to be (intraday, positional, long term, only futures, option trader, etc) then you have to choose the strategy that fits with your pocket, time and personality.

I prefer to trade less (no patience to see growing and diminishing two-coloured candles) and hence spreads are my choice.

Sir,
I also want to Trade less and would request you explain me Spreads of your choice so that one day I should be able to Trade like you.
Regards
Karanm

 

[trader.trends]

Sir,
I also want to Trade less and would request you explain me Spreads of your choice so that one day I should be able to Trade like you.
Regards
Karanm

Karan
Read through all the posts (especially the first few) in this thread if you want to trade spreads. Each of us has to define the risk we are willing to take for the reward we seek. Each of us has to choose our trade. Each of us has to take the responsibility for the trade we choose.

AW10 has done a tremendous job in this strategy in helping us with the growth of our wings. Each of us has to learn to fly.