I will be executing this new Trade on Monday, Advice

#1
Hi Bhailog, Guruji ko pranam!

My Trade on Monday...Experimental

I will be Shorting for the first time...so please guide

As Market is uncertain it can move either way, so by going thru traderji and other platforms providing all sort of pros and cons about trading i have prepared a trade for Monday...

Since the market is closed this premiums mentioned below are as of on Friday 18 Nov


What i will be doing is..

Expiry: 29 DEC 2016

SHORT
1. I will Sell 8400CE at 55, 1 lot (75*55 = Rs 4125 )
2. I will Sell 7600PE at 43, 1 lot (75*43 = Rs 3225 )

LONG
1. I will Buy 8500CE at 35, 1 lot (75*35 = Rs 2625 )
2. I will Sell 7500PE at 33, 1 lot (75*33 = Rs 2475 )

Investment: Rs 12450 on 21 Monday 2016

I am a newbie, where this trade will go, just a Question...comment please
 
#2
Hi Bhailog, Guruji ko pranam!

My Trade on Monday...Experimental

I will be Shorting for the first time...so please guide

As Market is uncertain it can move either way, so by going thru traderji and other platforms providing all sort of pros and cons about trading i have prepared a trade for Monday...

Since the market is closed this premiums mentioned below are as of on Friday 18 Nov


What i will be doing is..

Expiry: 29 DEC 2016

SHORT
1. I will Sell 8400CE at 55, 1 lot (75*55 = Rs 4125 )
2. I will Sell 7600PE at 43, 1 lot (75*43 = Rs 3225 )

LONG
1. I will Buy 8500CE at 35, 1 lot (75*35 = Rs 2625 )
2. I will Sell 7500PE at 33, 1 lot (75*33 = Rs 2475 )

Investment: Rs 12450 on 21 Monday 2016

I am a newbie, where this trade will go, just a Question...comment please
This strategy is called credit vertical spread on either sides or short iron condor.
Chrck payoffs, u will pay money of 50*75 =3750 and max loss of rs 100, if nifty stays between 7480 - 8630 uptil 29th dec. ..
Risk reward of 100:20 in put side, n 100:30 in call side.
Good thing is u will always make money from one side.

The trick here is...if immediately there id a big mive either side ( whi h is likely fue to volatility) ..ur strategy's MTM would be loss n u might have to hedge with some position....



Pros:



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doss186

Well-Known Member
#3
Shorting options require full margin as futures. It best to buy call or put as they require less margin. I give you a hint, opponent of 8500CE is not 8500PE but 9000PE.
 

tradedatrend

Well-Known Member
#4
1. It shall require a full margin or approx 70-80 thousand

2. In best case scenario you shall make

(55+43) - (35+33) = Rs. 30 x 75 (lot size) = Rs. 2150 per set

3. And in worst case scenario you shall lose

((55+43) - (35+33)) - 100 = Rs. 70 = Rs. 70 x 75 (lot size) = Rs. 5250 per set

Decide yourself would you want to risk Rs. 5250 for a gain of Rs. 2150

This profit / loss is exclusive of Brokerage and Taxes.
 

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