Staring At Massive MTM Losses - What Should I do Now?

[smartcat]

Selling calls to repair my existing position will cost me anywhere between Rs. 2.5 Lacs to Rs. 5 Lacs as margin money. For somebody with smaller positions, these "repair strategies" are quite useful!

Based on some of the suggestions on this thread, I have come with a big pilaan! Comments please -

- I'm not touching the calls for atleast one more week.
- After one week, I might sell off 200 calls, especially if Nifty remains sideways or goes up.
- I will buy 100 5300 Puts April Expiry on monday @ Nifty Spot 5350
- I will book profits in 50 Puts if Nifty Spot reaches 5250
- I will book profits in 50 Puts more @ Nifty Spot 5200
- I will Buy 100 5200 Puts April Expiry @ Nifty Spot 5200 and continue to sell for every 50 point movement in Nifty.

The idea is to earn income and hence reduce my overall losses in the calls.

Now let's say - Nifty starts moving up.

- I will buy 100 5400 Puts April expiry @ Nifty spot 5400. If markets tanks from here, I will sell these puts and make profits.
- But lets say, Markets continue moving up to 5500. I will buy 100 more Puts 5500 April expiry. Again, will book profits when Nifty tanks from 5500.

- If Nifty moves up to 5600, I think my calls would breakeven. Will exit the position.

Not quite sure what I'll do with all those puts from April expiry if markets continue shooting up though! Maybe I'll start a new thread asking for help

 

[traderjaya]

You can try one of theses methods if needed, I will give 3 or 4 examples. This is just an idea ,

Screenshot

Screenshot

From above example you can see that if market expires below 5200 , your maximum loss will be 24400 if market expires above 5400 your maxium loss will be 104400. You can do one thing to minimize loss on upside, if market moves above 5400 or 5500 you can short ATM 5400 pe , buy ITM CALL or buy in futures . For selling options, good amount of margin money is blocked..

i would suggest to sell 5300 call. this would result in 50k to 90k loss.

 

[traderjaya]

with UP results going against Congress, i expect market to go down.

 

[DanPickUp]

SC

With the questions you ask in post 51, I think it is time for you to download option oracle. This software is for free use and you will be able to test your questions with that software and see how your ideas will work out.

http://www.samoasky.com/download.html

DanPickUp

 

[MurAtt]

@Munde - What is the symbol for Nifty in Opt Oracle ?

 

[LivetoTrade]

@Munde - What is the symbol for Nifty in Opt Oracle ?

You just need to type Nifty in the box and click on update.

 

[LivetoTrade]

Smartcat, offtopic....

same id on an automotive forum?

 

[TraderRavi]

Wow....One query and so many expert answers....

apne ghar ki samasyao ka koi hal nahi ...but padosi ki samsya ka ilaaz zaroor hai na hamare paas.....:rofl:

 

[Smart_trade]

Wow....One query and so many expert answers....

apne ghar ki samasyao ka koi hal nahi ...but padosi ki samsya ka ilaaz zaroor hai na hamare paas.....:rofl:

Apne ghar mein samasya hi itni hai , kis kis ka hul nikalen ? Padosi ki samasya sun kar lagta hai chalo hum akele hi samasyaon se ghire nahi hai....aur bhi hamsafar saath mein hain.....

But on serious note, the person who is stuck up with a bad position really needs some genuine advice so that he can salvage his position with minimum damage.

Smart_trade

 

[smartcat]

Smartcat, offtopic.... same id on an automotive forum?

Absolutely. What's your ID there?

Wow....One query and so many expert answers....
apne ghar ki samasyao ka koi hal nahi ...but padosi ki samsya ka ilaaz zaroor hai na hamare paas.....:rofl:

If I breakeven on this trade, I'm going gift 50 Nifty 6600 March expiry call option to everybody who has offered suggestions :clap:

If you are in Bangalore like me, a bigger treat @ any place you choose.

Smartcat,
What if market doesn't move for 1 more week. Very much possible that market doesn't move either way till 14th.

Possible, but very unlikely right? So many events happening in between.