why selling far OTM Calls ?

[anml]

This is today EOD LIC HSG FIN option chain

If we see here Highest OI at 700 call at 814000 , above that retailers bought 710 , 720 calls huge addition today , means option writers willing to write at that 710 , 720 levels as they expecting wont go abv that level ok, we assume that at this expiry script closing below 700 only , but are they selling for this premium rs 1.25 and .90 paise for one lot (1350 to 990 rs / lot )which total margin would cost 70k ?
or any other reasons behind this ?
Option Expert please clarify me , Thanks in advance .

 

[traderniftybull]

I am no option expert
but yes

They are selling for this premium rs 1.25 and .90 paise for one lot (1350 to 990 rs / lot )which total margin would cost 70k. BTW, I feel that margin costs us 70K but not to them, because of hedging etc etc.

These HNI traders have huge spare money to invest and they think that writing such OTM calls (or puts in some cases) are safe bet to make money in a short time.

But I wont suggest you to do it, unless you understand what you are doing. Its a risky trade.

 

[Subhadip]

I am no option expert
but yes

They are selling for this premium rs 1.25 and .90 paise for one lot (1350 to 990 rs / lot )which total margin would cost 70k. BTW, I feel that margin costs us 70K but not to them, because of hedging etc etc.

These HNI traders have huge spare money to invest and they think that writing such OTM calls (or puts in some cases) are safe bet to make money in a short time.

But I wont suggest you to do it, unless you understand what you are doing. Its a risky trade.

Exactly....

 

[anml]

I am no option expert
but yes

They are selling for this premium rs 1.25 and .90 paise for one lot (1350 to 990 rs / lot )which total margin would cost 70k. BTW, I feel that margin costs us 70K but not to them, because of hedging etc etc.

These HNI traders have huge spare money to invest and they think that writing such OTM calls (or puts in some cases) are safe bet to make money in a short time.

But I wont suggest you to do it, unless you understand what you are doing. Its a risky trade.

Ok thanks bro.