High Profit EOD based option Strategy for Advanced Traders

[vssoma]

dear dan,
how r u doing? it's been over 1 year we discuss any strategy in TJ.

sorry to disturb you but as you said don't post anything else than selling options in the thread,
but your PM is disabled that's why i am posting here.

first...how you decide that i am doing business? pls check all my posts then come to conclusion.
and one thing i want to clear is neither i am doing business nor i have plans to do in my future.
by grace of god, i am happy with what i am earning now. i am sure, if i start any business
definitely this is not the way to look for customers, if so, i'll come up with fully openly as per TJ's guideliens.

second...i posted that as example for one who is asking for strategy for less money.
of-course every strategy has it's own advantages and disadvantages. if you like to discuss ok we'll discuss if you don't like, it's also ok. but this is not the way...

you really helped me to learn strategies and shared some books also,but this type of rudeness, i didn't expect from you.

if you feel that any of my post is not good and misleading people that i am expecting money from them, pls let me know and i'll correct/edit it.

you are like guru (means teacher) to me. i learn from you. i want to keep good n healthy relationship with you. i hope you accept this.

once again sorry...if there is anything is wrong pls let me know.

thank you.

 

[DanPickUp]

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[comm4300]

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[DanPickUp]

@Comm4300

I am not relay interested to help any body more, as even Vssoma in the past called me to do back testing on his ideas which he now is selling as educational option videos and tutorials. He never offered me any money, as of course every thing was expected for free with the plan to get knowledge to sale it later.

Sorry, but from my side closed for ever on the option side

Take care / DanPickUp

 

[comm4300]

@Comm4300

I am not relay interested to help any body more, as even Vssoma in the past called me to do back testing on his ideas which he now is selling as educational option videos and tutorials. He never offered me any money, as of course every thing was expected for free with the plan to get knowledge to sale it later.

Sorry, but from my side closed for ever on the option side

Take care / DanPickUp

no worries. I respect your decision.

Appreciate what you have shared so far. Made a big impact on my trading career. All the good "karma" to you

thank you.

 

[ananths]

No Loss Strategy
Transaction to be done on 07 Nov 2013 for Base Index at 6215.15
Buy 6250 CE at Price 116
Sell 6550 CE at Price 16.65
Buy 6550 PE at Price 281.05
Sell 6200 PE at Price 83.85
Net Points Paid: -296.55

Profit if Index is less than and equal to 6200 on 28 Nov 2013 is 53.45:thumb:
Profit for Index greater than equal to 6250 on 28 Nov 2013 is 3.45:thumb:
Profit varies between 53.45 and 3.45 between 6200 and 6250. For example, at 6225, the profit will be 28.45.

Where is the catch?
Buying 6550 PE at Price 281.05 is challenging task. Rest everything seems achievable. If Nifty remains 6250 and above on 28 Nov 2013, then profit is 3.45 that just covers brokerage and STT.

Very Important:
Either do not enter into trade, if enter, be sure to make all the trades at one go. If you do two trades and miss one trade, then this strategy might result into huge losses. So, this is not for novice but only for Advanced Traders.

Profit and Loss given are indicative. The actual profit / loss depends upon the premium paid and received by you.

Disclaimer: I shall not be responsible if anybody does any trade based on the above guidance. The above strategy is only for advanced traders (and not for novice). I do not share your profit so not ready to share the loss.

Dear Pannalalji,

This strategy is an excellent one for those who can not spend too much time on market and would trade with one month view.

It has decent RR as well. The margin required also very less because it would be considered as two debit spreads on both sides.

Can we add one more leg when market goes above 6250 to increase the profitability?

P/L graph for this strategy is below.

 

[gmt900]

Dear Pannalalji,

This strategy is an excellent one for those who can not spend too much time on market and would trade with one month view.

It has decent RR as well. The margin required also very less because it would be considered as two debit spreads on both sides.

Can we add one more leg when market goes above 6250 to increase the profitability?

P/L graph for this strategy is below.

Dear Pannalal,
I agree with Ananth. Strategies with no loss or with very good R/R ratio will be welcome.

 

[shantanupawar11]

hello i m new in community i want to know how much margin is required to sell a lot of nifty

 

[msa5678]

hello i m new in community i want to know how much margin is required to sell a lot of nifty

Approx 28000 at the current NF price.

 

[pannalal]

Dear Pannalalji,

This strategy is an excellent one for those who can not spend too much time on market and would trade with one month view.

It has decent RR as well. The margin required also very less because it would be considered as two debit spreads on both sides.

Can we add one more leg when market goes above 6250 to increase the profitability?

P/L graph for this strategy is below.

Dear Ananthji and gmt900ji,

There are certain issues with the given strategy.

Buy 6550 PE at Price 281.05. As per Black Scholes formula, it should be around 297. So, your points are reduced by 16 points and 53.45 becomes 37.45.

According to me, there are simple rules for option game:

(1) Position to be taken either by last Friday of the month or at best in next 2 days. If you are not able to take position in these 3 days, you should forget about that month. You need to do only this single trade in the month. In case of profit, the trade is automatically square off by NSE on expiry date. In case of loss, you need to reverse the trade as and when indicated.

(2) There is no need to bother about Risk Reward ratio. If at all, you need to worry, it is about two things, delta and theta. If you use simple rule, you can expect around 10% returns per month. However, you may incur losses in 2 months (though in most cases it can be restricted to 10%, to be on safe side, you can take it 15%). So, net profit comes to 70%. But, my past data suggests that you can easily get 80% to 90% returns per year. I am working on these data and I shall publish the data for 5 years.

(3) If something exceptional happens, you may get even 40% returns or you may also get 130% returns. I have analyzed past data and these exceptions happened only three times in last 10 years.

(4) You require around Rs. 70,000 for one lot of trade as margin money. However, it differs from broker to broker. My estimate of Rs. 70,000 is based on the 7% margin. If your broker is taking 10% or 11% margin, then requirement goes up.

Whatever strategy I am giving, these are based on the closing premium price for that day. If Nifty opens on the next working day at same level, you may get premium very near to the amount listed in strategy. However, your profit / loss depends upon the premium paid / received by you.