Derivatives education site

Thanks Gandhi

Regards

Satya

i personally dont believe in delta neutral strategies as adjustment increases transaction costs on a continuous basis.

dear satya

these are questions that i cannot answer. may be someone else can help

you.

in technical analysis and trading, nothing is absolute. this depends on what ur trading system is. the motto is when in doubt, look left. that is look at past action. if it was absolutely flat, and there is a sudden jump in OI by even 15% thats a lot. theres no absolute figure. u have to take everything in context. if theres a demerger or takeover announcement and OI goes up by 40%, is that abnormal? of course not.

see the report from hindu business line. they have not used any adjective for 30% to 5.45%. many type its the media and analysts who use these adjectives.

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Tata Engineering's May future contract was active with open interest

jumping by 30.33 per cent. The spot closed at Rs 158.70, higher by Rs

3.25. The May contract closed at Rs 158.60 whereas, the June contract

closed at Rs 159.35. Open interest in June contracts jumped by 35.48

per cent.

Index options: The most actively traded contract was the May 950 call

(ITM). The call, which has been appreciating for the past three days,

closed at Rs 16.45. Open interest increased by 5.45 per cent. The May

960 call, which is at-the-money, appreciated to Rs 10.20 and open

interest increasing by 6.16 per cent.

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for me theres only one abnormal OI that is 95% of marketwide limit...thats when the stock is barred from further FNO trading...no such thing happens for index future.


2. i look at these roll over data on cnbc. otherwise i dont bother about them. i get the derivatives data from sharekahan and nse and continuously monitor open interest. if during the end of the month the next months open interest increases, there is a healthy position (no indication of direction is available from here). i dont know if thats roll over or new contracts initiated. for me the effect is the same...interest in the instrument has gone up or down.

Thanks for ur reply sir

i wil come back with some more doubts

regards

satya

3. Again I read somewhere that if the market heavy weights are reaching there limits in F&O then there will be little bit upside left and some profit booking may happen . so what is this limit and how can we get cues from it


unfortunately india noone is transparent about statistics...why will they report fii data a day later? in the US theres something called insiders buying that u can see on ur options terminal and make out what is happening. for commodities again theres COT report where u can see what the big guys are doing. here theres none...rather not that i am aware of...if anyone can enlighten me it will be great. Of course u can see here client wise limit for india

http://www.nse-india.com/archives/ns...6-DEC-2006.lst

ZEETELE, has limit 2349469 , is it no. of open interest is so then when we do have open interest of zee rises up to that level then what wil happen
as there can not be fresh buying so wil there be some profit booking in the counter . and then resume its previous trend

can we consider it while trading or open interest is enough to track a counter


Regards

Satya

hi satya

it has been seen that a stock movement becomes slow when fno limit is hit. but that does not guarantee anything...because 95% of the mkt limit is a huge no of shares...and that can be traded...longs and shorts cancel each other out, no new positions can be added. suppose price is going down, i have a long pos, i can sell to protect my profit, while someone holds a short position, he can buy to book profit, if he thinks reversal is iminent.

open interest is never enough...never is any technical analysis and never is any indicator....only price action is the proof...as martin pring puts it...when u see clouds u dont open an umbrealla...tho u definitely take it urself...onl;y when it rains that u open it. see a brilliant article posted on open interest here by CV or agilent (cant remember)

thank u sir

i wil come back with some more doubts

regards

Satya

Hi!

Just started to work on open interest. Some doubts but relating to FII, as I am curious about their activities.

Please help me in this. This all pertains to FII data.

In the last three days including today open interest in rising for index futures and number of contracts also increased. But In stock futures, we saw decrease in number of contracts for yesterday and day before yesterday as well as decrease in open interest but today decrease in number of contracts but rise in open interest.

What should we concur with this, that they are selling index and going long on stock. Can they add longs in index today but open interest has increased in index and number of contracts also increased. In index, sell amount was more than buy.

For further details, please see attachment

Attached Files

fii activity.xls (14.5 KB, 7 views)