NIFTY Options trade : Why and what-if...

[LivetoTrade]

linkon....today calls decreased by 25 - 30%.. but puts increased by only 10 - 15 %........what this means.......

On two specific occasions earlier, I have noticed this happening, and the next trading day there was a gap down.

Maybe Linkon can help clarify better.

 

[TraderRavi]

On two specific occasions earlier, I have noticed this happening, and the next trading day there was a gap down.

Maybe Linkon can help clarify better.

lets see tomorrow..............

 

[LivetoTrade]

And Lo ! It happened once again today

 

[DanPickUp]

linkon....today calls decreased by 25 - 30%.. but puts increased by only 10 - 15 %........what this means.......

Hi TR

Here in a nutshell the answer to that, which is as simple as it is:

Depending on markets and market situations, puts are in general a bit more expensive priced compare to call options. This is what happen in Nifty and this is what happen in the S&P500. Just to mention two markets you know.

If now the market drop, and this goes in general faster compare to the rise of a market, the puts have some of this risk ( fast dropping ) already implemented in the prices.

That is why the puts increase less compare to the decrease of the calls.

Good luck and success in trading

DanPickUp

 

[columbus]

Source:StocksFortune

4700PE option saw some good addition.

 

[LivetoTrade]

Source:StocksFortune


4700PE option saw some good addition.

Now, in the current situation, do we see this as a hedge against the longs in future?
Or are the shorters taken by surprise?

 

[linkon7]

a 175 point gap up and market reacts wt a 30 point range flat balanced market...! Goes to show what very low participation can do to a market. Bears are not panic struck. Bulls are not go-go eyed. No one cares and this phase is tough for TA traders...!

personally i just purchased 5100 call and as long as 4925 is held...i'll keep adding to this position....!

 

[LivetoTrade]

linkon, could you also please suggest on the 4700pe OI addition?

 

[trader.trends]

A zzzzzzzzzzzzzzzz day for day traders with perhaps some action in the last hour.

 

[linkon7]

linkon, could you also please suggest on the 4700pe OI addition?

This is a long series and somehow, those were long on this till yesterday are supposed to be exiting while fresh shorts are supposed to be piling on it...! But funny thing is... there is no rush to short the 4700 put... the OI is coming down... its down 3.5%....!

This prolonged period of flatness and people are actually buying protection....! That too deep protection...!