Hi TJ,
I am working on this since last two months.
I observed that if you catch it as soon as market is opened in the morning then possibility of getting good price is much more.... I use following criteria to buy it.
I keep last day's closing price of straddle/stangle in your mind while taking trade. If opening is at same level of yesterday's closing then buy straddle at < or = to yesterday's price of straddle.
In case if i do not get at that price then wait paitiently for same or do not take trade on that day..
I am working on this since last two months.
I observed that if you catch it as soon as market is opened in the morning then possibility of getting good price is much more.... I use following criteria to buy it.
I keep last day's closing price of straddle/stangle in your mind while taking trade. If opening is at same level of yesterday's closing then buy straddle at < or = to yesterday's price of straddle.
In case if i do not get at that price then wait paitiently for same or do not take trade on that day..
My thought is that at the opening since volatility is high, we might not get a good price. The stradle/strangle would work best when the IVs are stable to low and then move higher.
So if we buy the straddle/strangle say when NIFTY is stuck in a 10 point range for 20-30 mins boht the PUT and CALL IVS are stable and hence we get a neutral price.
But if we buy at the opening , the IVs are so high that we end up paying a higher price either for the PE or CE , depending on a gap up or down opening.
Please correct me if I got this wrong.