Hi All,
I just thought of option selling strategy but cudnt find about it on internet so writing here to ask all the intelligent community members.
Suppose Nifty is trading at 5300 and I sell a Nifty call strike 5400 for Rs 100 and hold the position.
Scenario 1: If nifty goes down I will be making profits so I can book any time.
Scenario 2: If nifty start going upwards, I ll start making loss as call value will go up. So, what I ll do is, I ll buy Nifty future at 5500 so I ll cover any loss on expiry, else I ll not press the panic button and hope for my option price to come down.
Now I just wanna ask if this is correct logic or I am missing to see something here... Is it a no loss strategy or there are loop holes in it??
Any suggestions would be appreciated and will definitely be thanked by me ;-)
I just thought of option selling strategy but cudnt find about it on internet so writing here to ask all the intelligent community members.
Suppose Nifty is trading at 5300 and I sell a Nifty call strike 5400 for Rs 100 and hold the position.
Scenario 1: If nifty goes down I will be making profits so I can book any time.
Scenario 2: If nifty start going upwards, I ll start making loss as call value will go up. So, what I ll do is, I ll buy Nifty future at 5500 so I ll cover any loss on expiry, else I ll not press the panic button and hope for my option price to come down.
Now I just wanna ask if this is correct logic or I am missing to see something here... Is it a no loss strategy or there are loop holes in it??
Any suggestions would be appreciated and will definitely be thanked by me ;-)