Increased lot size -futures vs options

#1
Is anybody changed their strategy in march due to Lot sizes in F&O?
I think it is much better[and leveraged :)] to trade in options now rather than futures.

Ie in feb reliance

lot margin Now
75 27000+ 300 65000+

Now options 1 lot(300) at the money aroud 15000+ then its better to play multiple lots in option and exit within 5-10 points move which is much better than future as and always.
Please share your views...
 
#3
It is true, when Current Market Price of stock of a Growing (atleast 11%-15% CAGR on YOY basis even in these days) Company comes down to its recorded 52-Low, Exchange has no other choice but to increase the Lot Sizes so that the total liability of a trader should range within Rs.2,00,000 to Rs.3,50,000.

I am basically an Option Trader since last 3 years. This sudden rise in Lot Size has compelled me to review my trade-strategy. I always tried to control my investment with Rs.11,000/- with multiple allowable lots. Now since 1st February I have noticed that Price Range(High-Low) is very small and Bears are solely responsible for that. Even price moved within a range where range-width was below 2% of Day's High. So you have to square-up your position with no significant profit after deducting Tax and Brokerages. So I have revised my strategy in this way -

Trade first in NIFTY Option first. Then select a Option Stock which is GROWING even in this bad days - say for example BhartiArtl, Infosys,TataSteel,State Bank of India. Because in these counters Bears do not call the shot as is possible in IFCI,GVKPoiwer,Suzlon. The Option Contract (CALL for 5% UP Difference, PUT for 12% decline) in those growing Companies will give normal profits should anyone select Strike Prices very close to Current Market Price. Just select 3-days ROC, 9-D W%R and Stochastic - this is the MUST tools one need to follow. Donot forget Nifty is very deep inside the Bear Zone (atleast 22% below the 200-D EMA).

Waiting for further views from experience hands.:)
 

columbus

Well-Known Member
#4
It is true, when Current Market Price of stock of a Growing (atleast 11%-15% CAGR on YOY basis even in these days) Company comes down to its recorded 52-Low, Exchange has no other choice but to increase the Lot Sizes so that the total liability of a trader should range within Rs.2,00,000 to Rs.3,50,000.

I am basically an Option Trader since last 3 years. This sudden rise in Lot Size has compelled me to review my trade-strategy. I always tried to control my investment with Rs.11,000/- with multiple allowable lots. Now since 1st February I have noticed that Price Range(High-Low) is very small and Bears are solely responsible for that. Even price moved within a range where range-width was below 2% of Day's High. So you have to square-up your position with no significant profit after deducting Tax and Brokerages. So I have revised my strategy in this way -rse growing Companies will give normal profits should anyone select Strike Prices very close to Current Market Price. Just select 3-days ROC, 9-D W%R and Stochastic - this is the MUST tools one need to follow. Donot forget Nifty is very deep inside the Bear Zone (atleast 22% below the 200-D EMA).

Waiting for further views from experience hands.:)
Basically I am a NIFTY FUTURES player but never tried my skill at STOCK
futures.

With lot size increasing alarmingly like PRISM-22200 NAGFERT-21000
GVKPIL-19000,(all PENNY stocks <20 RS) RELIANCE-300 (vs 75) L&T-400(vs50) better to stick to NIFTY.

The gap between 50-dma and 200-dma is -800 points and the gap is set
to increase or market likely to fall further.
 

columbus

Well-Known Member
#5
Reliance had a lot size of 75 when it was ruling at 2400/-.Now the present
price is around 1200/- (for example sake),then the appropriate lot desirable
is 150.By keeping such a huge lot size (300) ,do NSE authorities feel RELIANCE come to sub-800 levels?
 
#6
I think any option contract(which is being traded before in F&O) above 3000 lot size is not liquid and if you got wrong strike in your hand you will lose your money fast.

Also It is better to trade in reliance with nifty as most of the time it is responsible for big moves in nifty and you will enjoy lot size of 300 :)
 

Capricorn

Well-Known Member
#7
I think any option contract(which is being traded before in F&O) above 3000 lot size is not liquid and if you got wrong strike in your hand you will lose your money fast.

Also It is better to trade in reliance with nifty as most of the time it is responsible for big moves in nifty and you will enjoy lot size of 300 :)
Only if the trade goes your way...:D