To play during election results day

[cinderblock]

Making 30K from 1.5K is Possible!!!!! I can recall one very Recent Trade of my friend He Bought 6 Lots 5300CE @ Rs 5.5 and held it till expiry (Expiry was 5406 )

Profit Made 30K !!!!!!!

But it is Possible Before Election Result ???
I doubt
Since in 2009 Before Election I sold 3900 CE (Naked) even after Hugh Gapup I managed limit loss only to Rs 12000/- ( I could able to buy back the call option even 30 to 40 Pts less than it's intrinsic value

40-50K with a risk of 1.5K with 1 lot is impossible. Let me repeat, impossible.

So you see, these incredible risk-rewards are almost impossible in the F&O market especially when everyone knows well beforehand that there's going to be a big move!

..............

 

[ananths]

One of my friends took a chance during last election...I guess the result was on a weekend and he was holding a single OTM call option. I also had the same position but squared off on Friday fearing the result. His risk was around 1.5k and he got a return of 40-50K.

So one can take minimum one lot on each side without any fear.:thumb:

40-50K with a risk of 1.5K with 1 lot is impossible. Let me repeat, impossible.

With a lot size of 50 and assuming a risk of 1.5K would mean the options were worth Rs. 30. Look at the bhavcopy for 15th of May 2009. Nifty closed at 3671. The only OTM options with a risk of 1500 and below are options with a strike of 4000 and above.

On the 18th of May 2009 (Circuit up), the maximum you would have earned for OTM options for 4000 strike and above (assuming you sold at the highs of the day) is around 19000 per lot.

Only if you had bought options of 3400CE and below would you have earned 50,000 per lot but these were not OTM on the day before the elections and they were worth 250 - 300 per lot (risk of 13K-15K) and above for a better part of May 2009 before the elections.

So you see, these incredible risk-rewards are almost impossible in the F&O market especially when everyone knows well beforehand that there's going to be a big move!

Making 30K from 1.5K is Possible!!!!! I can recall one very Recent Trade of my friend He Bought 6 Lots 5300CE @ Rs 5.5 and held it till expiry (Expiry was 5406 )

Profit Made 30K !!!!!!!

But it is Possible Before Election Result ???
I doubt
Since in 2009 Before Election I sold 3900 CE (Naked) even after Hugh Gapup I managed limit loss only to Rs 12000/- ( I could able to buy back the call option even 30 to 40 Pts less than it's intrinsic value

I never said exactly it was 1.5k ...or the profit made was exactly 40K.(guessed a bit here)
I was just mentioning the return was of such huge magnitude. I'm damn sure its possible in such huge events if luck is in your side. I can't give proof for that now. Its upto you if you want to believe or not. :thumb:

 

[cinderblock]

....................................

 

[ananths]

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[anup47]

can some one suggest what will happen to dec 2014 ivs before lok sabha election result 2014 ? right now its trading at 20.50 lower than june 2014 ivs which is some where between 22 to 23. I want to focus on this months iv as bcoz others will be either trading may or june. If something goes wrong with the ivs of may or june (i mean if they don't go up) at least in dec 14 options you would have more time to think.

 

[anup47]

June Ivs are dropping.... Any clue why?

 

[anup47]

there are no updates on it...... No one is interested in June or Dec 2014 Ivs.

 

[anup]

there are no updates on it...... No one is interested in June or Dec 2014 Ivs.

Wait,Some expert will answer. But my question to you is why are you looking for June or Dec 2014 IV's there is so much of time

 

[anup47]

Do you want Ivs to shoot up and then we will start thinking? I'm sure no. Before the market realize that the ivs are low i think we should get serious about it. Should start discussing about say what would be the straddle value before the election results are out. How much market should move after the results are announced. should be checking about the history of ivs during election results. Impact of Aam Admi party in Lok sabha election etc.

 

[anup]

Do you want Ivs to shoot up and then we will start thinking? I'm sure no. Before the market realize that the ivs are low i think we should get serious about it. Should start discussing about say what would be the straddle value before the election results are out. How much market should move after the results are announced. should be checking about the history of ivs during election results. Impact of Aam Admi party in Lok sabha election etc.

Ok. Will invite other option experts like Dan,Ananth etc to this and resolve your query soon. Sorry for the del;ay offlate i was busy with office work..