Buy 1 lot qty any blue chip shares in EQ which one are trades in F&o ... Example : RELCAPITAL
If you purchase 1 lot at cmp : 520.00 * lotsize 500 = 2,60,000
Investment = 2,60,000
In every month expiry day just write one lot in the money call option (next month )
for example : Dec 2014 contract 520 call option cmp : 25.50
you will get premium : Rs.12750.
If you continue next 12 months this like trades...Yes you will get aprox 40-50% return...
you can back test this strategy..Nse website have a historical options EOD data...
If you purchase 1 lot at cmp : 520.00 * lotsize 500 = 2,60,000
Investment = 2,60,000
In every month expiry day just write one lot in the money call option (next month )
for example : Dec 2014 contract 520 call option cmp : 25.50
you will get premium : Rs.12750.
If you continue next 12 months this like trades...Yes you will get aprox 40-50% return...
you can back test this strategy..Nse website have a historical options EOD data...
I have a confusion. If reliance capital stock fall 200 points in this expiry. Then we get only 12750. But our stock value will be down by 1 lac.
And i have back test BHEL from 26-07-2013 to 26-12-2013. It has overall given a huge loss.
Kindly clear my confusion. May be i am not understanding your strategy.
Thanks