how abt this strategy ?? if BNF spot is @ 25000 . Buy 1 lot of 25500 ( 2% of Spot price) and sell 2-3 lots of 25700 ( approx 3% of spot price ) and wait end of day or exit when you are in profit of 2% -3% ?? capital required would be 75-80k but less risk and less profitable .it would give 4-5% ROI easily in a month .
thanks
Naidu.
Hi Friend,
25500 is a premium level and an automatic traditional S/R for BNF... in current context 25500-25600 is a resistance zone... so in that sense your position is okay...
It is a ratio spread... buy at front you should have some options when under stress... that's correct and of course a better bet considering current volatility...
but it is not 'sure shot' that by the end of the day or at expiry you will see profit...
my suggestion is first fix your goal... what you expect from this position... eating premium or play the volatility... this is the most important for any option combination... once you fix your goal then fix a target... in terms of ROI... these two will make your life smoother in option trading journey
be assured that no straight forward rules applied in options... it is pure psychology which unfortunately plays havoc at times... specially when we are shorting... delta, gamma and vega... all are our enemy... and those move exponentially with any trending or wild move and market perception of the participants... our only friend here is theta... which unfortunately start acting just one or two days before expiry in weekly options...
so friend... always have a management plan in place... most importantly when you don't have a S/L....
