As we all know Protective Put Strategy. I made Advanced version of it and it works.
Strategy :
1st Day of every month contract that is Friday at Market close timing.
Buy One Future Contract and Buy 2 ATM Puts.
That’s all. So Simple Strategy.
Nifty Lot Size: 25
Total Investment:
For buying 2 ATM put around Rs. 5000/- to Rs.10,000/-
Buying Future Contract Margin : 20,000/- to Maintain MTM.
So Total Investment : Rs. 30,000/-
Example:
Last Month August 2015
On 1st day of Contract Friday 31/07/2015 Market Close timing
Buy 1 Future contract at : 8569.65
so we Buy 2 ATM Put of 8600 (Use nearby figures to buy Put in 100 series)
Put Cost : 136 * 2 = 272
272 * 25 ( Lot size) = Rs. 6800/-
Ok lets see what happened next
In August series
On 25/08/2015 when Put is At high
Put Price was 930
As we have 2 lots so 930*2 = 1860
1860 * 25 (Lot size) = Rs. 46,500/-
Now Profit in Puts : 46,500 – 6800 (Initial Investment) = Rs. 39700/-
As we got profit in Puts but at the same time we Bought Future and got Loss in it.
Future Buying Loss = 8570 - 7665 = 905
So 905 * 25 (Lot Size) = - Rs. 22,625/-
39700-22625 = Rs.17,075/-
So our Net Profit in August is +Rs. 17,075/-
Below are 8 months results of this strategy From Jan 2015.
August 15: + Rs.17,075/-
July 15: - Rs.475/-
June 15: + Rs.4324/-
May 15: + Rs.2650/-
April 15: + Rs.5300/-
March 15: + Rs.4700/-
Feb 15: + Rs.1700/-
Jan 15: + Rs.10,825/-
From Jan to Aug 2015 in 8 Months only one month Loss and it was Rs.475/-
8 Month Statistics:
Net investment : Rs. 30,000/-
Total Net Profit: Rs. 46,099/-
Return:150% in 8 Months of 2015.
If you check previous years you will get same results of this strategy.
Now Most Imp. :
Before some genius come and say it is not possible to catch High any month.I show results to make strategy simple.
If its not possible you to catch High just close position whenever you get 100 points net profit in either direction.
By this strategy you can make money in long term because to make profit we need market upside or downside move of 300 to 500 points within month, depends on Put Cost.
And Now a days 100 or 200 points move in a single day is general.
I just want to make strategy simple so any new trader can understand it.
BUT
In Some Months Market goes Upside or Downside and we make profit in either Future or Put and in same months our losing position also make profit or become neutral because Market come to its original position or going opposite direction in same months.
I did not add that Calculations in this strategy to make it simple.
Now its your turn, I request Senior Members of Traderji Give your Opinions, Do some R&D to make this Strategy more Profitable.
Thanks
Strategy :
1st Day of every month contract that is Friday at Market close timing.
Buy One Future Contract and Buy 2 ATM Puts.
That’s all. So Simple Strategy.
Nifty Lot Size: 25
Total Investment:
For buying 2 ATM put around Rs. 5000/- to Rs.10,000/-
Buying Future Contract Margin : 20,000/- to Maintain MTM.
So Total Investment : Rs. 30,000/-
Example:
Last Month August 2015
On 1st day of Contract Friday 31/07/2015 Market Close timing
Buy 1 Future contract at : 8569.65
so we Buy 2 ATM Put of 8600 (Use nearby figures to buy Put in 100 series)
Put Cost : 136 * 2 = 272
272 * 25 ( Lot size) = Rs. 6800/-
Ok lets see what happened next
In August series
On 25/08/2015 when Put is At high
Put Price was 930
As we have 2 lots so 930*2 = 1860
1860 * 25 (Lot size) = Rs. 46,500/-
Now Profit in Puts : 46,500 – 6800 (Initial Investment) = Rs. 39700/-
As we got profit in Puts but at the same time we Bought Future and got Loss in it.
Future Buying Loss = 8570 - 7665 = 905
So 905 * 25 (Lot Size) = - Rs. 22,625/-
39700-22625 = Rs.17,075/-
So our Net Profit in August is +Rs. 17,075/-
Below are 8 months results of this strategy From Jan 2015.
August 15: + Rs.17,075/-
July 15: - Rs.475/-
June 15: + Rs.4324/-
May 15: + Rs.2650/-
April 15: + Rs.5300/-
March 15: + Rs.4700/-
Feb 15: + Rs.1700/-
Jan 15: + Rs.10,825/-
From Jan to Aug 2015 in 8 Months only one month Loss and it was Rs.475/-
8 Month Statistics:
Net investment : Rs. 30,000/-
Total Net Profit: Rs. 46,099/-
Return:150% in 8 Months of 2015.
If you check previous years you will get same results of this strategy.
Now Most Imp. :
Before some genius come and say it is not possible to catch High any month.I show results to make strategy simple.
If its not possible you to catch High just close position whenever you get 100 points net profit in either direction.
By this strategy you can make money in long term because to make profit we need market upside or downside move of 300 to 500 points within month, depends on Put Cost.
And Now a days 100 or 200 points move in a single day is general.
I just want to make strategy simple so any new trader can understand it.
BUT
In Some Months Market goes Upside or Downside and we make profit in either Future or Put and in same months our losing position also make profit or become neutral because Market come to its original position or going opposite direction in same months.
I did not add that Calculations in this strategy to make it simple.
Now its your turn, I request Senior Members of Traderji Give your Opinions, Do some R&D to make this Strategy more Profitable.
Thanks
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