Nifty Option's trading.... Earn regardless of where the market goes !!

[arnav_rulz]

Right now i havent worked out many ... but for now Im making a somewhat comman range ....

Range = 3800-5000


Buy 50/100 4400 Put @ 230
Sell 100/200 4100 Put @ 115

(*investment fully recovered)


Buy 50/100 4600 Call @ 105
Sell 100/200 4800 Call @ 50

(*Investment of rs 500 Only)


Net Investment = 500 Bucks




**Rationale for investment....

1)In this strategy your profit is from 4400-3800, If it goes above 4400 you dont lose a single penny.... but only below 3800 you start losing per lot..
similarly in 4600/4800 you lose above 5000 and no loss below 4600

2)If market trades btw 4400-4600 you wont earn on closing basis ,, BUT
Wat you will do is around 15th Oct, you would square off one or both of your positions and earn the premiums that have been reduced
because 4100 puts and 4800 calls (that we have written) would lose MUCH more than 4400 puts and 4600 (Calls that we brought)

3)expect a profit of 10k even if market stay between 4400-4600

4)above or below that but less than 4900 and 4000 expect profits upto 40k !! not 40 maybe but definetly 25-30k is possible...


Cheers

 

[bandlab2]

Right now i havent worked out many ... but for now Im making a somewhat comman range ....

Range = 3800-5000


Buy 50/100 4400 Put @ 230
Sell 100/200 4100 Put @ 115

(*investment fully recovered)


Buy 50/100 4600 Call @ 105
Sell 100/200 4800 Call @ 50

(*Investment of rs 500 Only)


Net Investment = 500 Bucks




**Rationale for investment....

1)In this strategy your profit is from 4400-3800, If it goes above 4400 you dont lose a single penny.... but only below 3800 you start losing per lot..
similarly in 4600/4800 you lose above 5000 and no loss below 4600

2)If market trades btw 4400-4600 you wont earn on closing basis ,, BUT
Wat you will do is around 15th Oct, you would square off one or both of your positions and earn the premiums that have been reduced
because 4100 puts and 4800 calls (that we have written) would lose MUCH more than 4400 puts and 4600 (Calls that we brought)

3)expect a profit of 10k even if market stay between 4400-4600

4)above or below that but less than 4900 and 4000 expect profits upto 40k !! not 40 maybe but definetly 25-30k is possible...


Cheers

4)above or below that but less than 4900 and 4000 expect profits upto 40k !! not 40 maybe but definetly 25-30k is possible...

can you explain this clearly ? since this is where max profit comes from. your wording is confusing. always use numbers so that others can clearly understand. for example, you can give a range and tell what could be max profit/loss

pl tell what happens when nifty closes

above 3800 below 4000

above 4000 below 4400

above 4400 below 4600

above 4600 below 4800

above 4800 below 5000

above 5000

below 3800

thanks for the strategy

 

[bandlab2]

*For the month of September...

Buy 100 4600 Put @ 285
Sell 200 4300 Put @ 135(i.e you get 135*2=270)


Buy 100 4100 Put @ 75
Sell 200 3900 Put @ 37(37*2 = 75 approx)

Total Investment = 1500 Rs


Also Sell 200 4600 Calls @ 65
& Sell 200 4200 Puts @ 100

Total Received = 33,000


Net Received = 30,000

hello all,

wow !!! this strategy is working well even in this volatile market. i am maintaining a spread sheet to track this, my profit is 9840 rupees and i am trading HALF of the lot sizes mentioned. so if yo take full qty, your profit wold be around 19k (1k to the man). this is awesome !!! and we are still 2 weeks away from expiry

great job arnav_rulz

26-Aug 11-sep
nifty 4344 4289


Buy 50 4600 Put @ 285 285 -14250 320 1750
Sell 100 4300 Put @ 135 135 13500 121 1400

Buy 50 4100 Put @ 75 75 -3750 50 -1250
Sell 100 3900 Put @ 37 37 3700 16 2100

Sell 100 4600 Calls @ 65 65 6500 26.6 3840
Sell 100 4200 Puts @ 100 100 10000 80 2000



15700 profit 9840

 

[TFL]

Hey all if starting this new thread where i would post Nifty buy/sell call/puts strategies where we would try and earn regardless of where the market goes !!


I had a similar thread in Equities section, but i realized that this section will be much more appropriate than that one.

I hope it goes well

PRINCIPALS We Will try to Follow....


**Looking @ high amount of margin required ... WE will Try our Best to NEVER Increase our open Positions beyond a limit ... (i.e our amount @ risk so that our margin doesn't increase because we have to be realistic ..

We will try and never have More than 6 open positions @ 1nce... From next time ill make a diff strategy and try to reduce more positions ....


*Right now i am trading in multiples of 100 & 200 just for the purpose of easier calculations... You could even trade in multiples 50 & 100 but try and keep the options brought & sold in the same proportion of the strategy given...

If We become bearish on the market... we would alter our strategy....
**But that doesnt mean we would start to short because thatz not the Purpose of the thread !! We Dont Do Any positional Trades !! We let the market go where ever it want to goooooo !!

Arnav_Rulz,

Its PRINCIPLES not PRINCIPALS.
We should be perfect right? as we are TRADERS. Joking...

Thank you.

 

[AW10]

Arnav_Rulz,

Its PRINCIPLES not PRINCIPALS.
We should be perfect right? as we are TRADERS. Joking...

Thank you.

Traders are not perfectionists. Analysts are.
Traders need to think in terms of probability.. and in the market, probability of being right is always less then 1. Successful traders are always prepared to accept that they are wrong and hence they manage their risk well.

Happy Trading.

 

[SriVijay]

sir

kindly answer my new bie question

buying a call and put means fixed outlay of money + brokerage

But incase selling a call and put , they say we recieve premium amount
Ok. but what will be the ledger accounts with my broker when my sell suffers . They say we must maintain mtm margin as that of futures.
I want explanation for both stock and indiex options.

If we want to maintain mtm ( in case of sell options) then the investment amount of arnaz rules strategy will be questioned. kindly explain....

regards
vijayakumar

 

[shoeman]

Dear Arnav_rulz,
I worked out in detail your suggestions. I don't at all figure out how you've arrived at the 10K figure. In fact, after putting up the margin money for writing 4 lots, the best case scenario that I see from my tables is about 5k (maximum), that is if you foreclose some of your positions in the no-gain range. Have I missed out something or am I making a mistake somewhere?!
[Some assumptions I have made are (a) entry is at about 40 days ahead and selective sq off is at 10 days to expiry, (b) the IV is range-bound.]

 

[pasha]

The two best case scenarios are if the Nifty closes at 4100 or 4800 at expiry. The profit would be 15k or 10k per lot.
The options sold have 330 Rs of time value which is decaying twice as fast as the bought options, so closure before expiry should be profitable if the nifty stays rangebound.

 

[shoeman]

Dear Pasha,
The 10k & 15k that you have calculated is the best case at expiry and you are ITM. Can you please calculate what is the profit shall be when it is an OTM scenario and you are foreclosing, as suggested? Thanks. (Well, that's what I meant with my 5k calc.)

 

[pasha]

Irrespective of OTM or ITM, the amount of time decay on the premium depends on how much time is left before expiry. Time decay per day (approx) = Premium/days left