Option Buy Recomendations

[ghosh_ak34]

Dear Mr. Ghosh,

I am new to this forum can you please explain this.

Regards.

Dear sethmohit79,

Buy near money call or at money call depending on which one is closed to the of future price that you are long. Example if you short Nifty future at 4697 then, you can buy a near money call of Nifty strike price 4700 to hedge the same.

Regards

 

[ghosh_ak34]

Dear Friends,

For Nifty Future traders who would like to trade as per trend check strategy posted in 1st post of the thread, Nifty levels for tomorrow are as under:

Resistence at 4645
Support at 4535

If you go short 1 lot then, buy 1 lot at money or near money call and if you go long 1 lot then, buy 1 lot at money or near money put to hedge. Reco. to trade as per trend strategy posted in 1st post of this thread.

Regards

 

[surya_sun]

Friends.
I have bought 100 (2 lots) @ 114/- 4700 CE today and later again @ 90 (3lots). My current average is about 98 for 5 lots.
Any suggestions on movement.. If the market moves tommorrow by gap opening of 50-60 points (which I guess is a possibility given the fact of europe and US markets today)... or atleast on intra-day basis..
any valuable opinions -welcome.
regards/Surya

 

[aditya14]

Friends.
I have bought 100 (2 lots) @ 114/- 4700 CE today and later again @ 90 (3lots). My current average is about 98 for 5 lots.
Any suggestions on movement.. If the market moves tommorrow by gap opening of 50-60 points (which I guess is a possibility given the fact of europe and US markets today)... or atleast on intra-day basis..
any valuable opinions -welcome.
regards/Surya

With no hedges?
I just hate when people do this.Buddy whenever u go into a trade make sure u buy some insurance.For all we know market may stay in a range or go down even.You have to balance the amount of risk rather than keep adding to a losing trade.

 

[aditya14]

Dear abigbull,

See its all about sentiments. Nifty if breaks 4755 and closes above this then, traders might become bullish and volatility of 4900 call will start to increase hence its better to hold 4900 write till 4755 is broken.

Regards

Yes i agree 100% but i am finding it hard to concentrate and hold to the position.I see one side of my trade winning and i wanna close it and keep the profit.What do you guys do to relax when selling options as its a patience game i know.

Btw my trade 1 day in is in green territory and time decay is making sure that the profit/loss is not proportional.If this works this month then iam never buying options outright again.

 

[ghosh_ak34]

Dear aditya14/abigbull,

Yes, one should be fearful when world is getting greedy.

Lets watch the Nifty direction for a while before initiating any bearish/bullish view. This is the time for writting a straddle i.e. Write Nifty Sept 4700 call and 4700 put with total SL = Rs 2000/- with a Target = Rs 7000/-

Regards

Dear Friends,

P/L for those of you who are holding the 4700 straddle :

Written 1 lot 4700 Call at 167.95 (CMP = 134.25 P/L= Rs 2117.5/-)
Written 1 lot 4700 Put at 176.6 (CMP = 127 P/L= Rs 2047.5/-)

Total P/L = Rs 4165/- per lot.

Hold with total SL = Rs 2000/- with a Target = Rs 7000/-

Regards

 

[aditya14]

Dear Friends,

P/L for those of you who are holding the 4700 straddle :

Written 1 lot 4700 Call at 167.95 (CMP = 134.25 P/L= Rs 2117.5/-)
Written 1 lot 4700 Put at 176.6 (CMP = 127 P/L= Rs 2047.5/-)

Total P/L = Rs 4165/- per lot.

Hold with total SL = Rs 2000/- with a Target = Rs 7000/-

Regards

This is too scary a trade for me.Without any hedging i wud be having lot of High BP days.With volatility so high its not a preferable trade at all.And 1 question, How much initial margin was required on this position.Also tell did u have to add margin when market broke below 4600.My sense is that when the volatility is low you should not write straddles.But this trade would require constant attention and quite a lotta margin to hold till expiry as this will be a volatile month i believe.Also If you deduct the high blood pressure days and the brokerage and margin requirements 4k is too low i think.

Btw i think next week we may see a breakout its my gut feeling.and this time upside may be broken.

 

[ghosh_ak34]

This is too scary a trade for me.Without any hedging i wud be having lot of High BP days.With volatility so high its not a preferable trade at all.And 1 question, How much initial margin was required on this position.Also tell did u have to add margin when market broke below 4600.My sense is that when the volatility is low you should not write straddles.But this trade would require constant attention and quite a lotta margin to hold till expiry as this will be a volatile month i believe.Also If you deduct the high blood pressure days and the brokerage and margin requirements 4k is too low i think.

Btw i think next week we may see a breakout its my gut feeling.and this time upside may be broken.

Dear aditya14,

Writting is for mature traders only. Its hedged, 4700 call write is hedged with 4700 put write. For margin req. one needs to talk to ones broker. 1 lot Nifty write margin is same as that of Nifty Future write. And when you hedge then, total margin req. is less. Talk to your broker for details.

For blood pressure patients option write and future is dangerous.

Regarding breakout, have said unless 4755 is broken and Nifty closes above this not to worry much. Moreover, we will maintain SL=Rs 2000/-

Regards

 

[ghosh_ak34]

Dear Friends,

For Nifty Future traders who would like to trade as per trend check strategy posted in 1st post of the thread, Nifty levels for tomorrow are as under:

Resistence at 4770
Support at 4632

If you go short 1 lot then, buy 1 lot at money or near money call and if you go long 1 lot then, buy 1 lot at money or near money put to hedge. Reco. to trade as per trend strategy posted in 1st post of this thread.

Regards

 

[spiritunit]

I think writing call option and buying put option is almost the same, but writing call option is limited profit and unlimited risk, for buying put option limited risk and unlimited profit, so why you do writing call option, instead of buying put option?