Low Risk High Return Call Option

TISCO March 2007 - 460 Call Option at Rs.1.60~Rs.1.75 will cost around Rs.1200 but can give a profit of upto Rs.5000 as the share is expected to move to Rs.470 levels in the current market recovery phase.

Regards
R. Sathyamurthy
http://murtheories.blogspot.com
http://mindpicks.blogspot.com

With only three trading sessions before expiry, the chances are very low that TATA steel will reach Rs. 470 and hence LONG 460 CA March Expiry will be a very risky strategy. The probability and time value is against upward movement in premium.

Best Regards,
--Ashish

Hi,

Thanks for the reply.

Considering that the amount involved is Rs.1200 odd and shares like Tata Steel are quite capable of making big price strides in single sessions, I stand by my view.

Best Regards
R. Sathyamurthy
http://mindpicks.blogspot.com
http://murtheories.blogspot.com

Hi!

Can we have an idea of probability of such an event occuring?

Best Regards,
--Ashish

TATA Steel was showing strenght throghout the day but unable to cross the hurdle of 450!!! In the last 15mins of closing it collapsed from 449 to its days low at 438 and closed at 440. So is ur 460CA risky now?? Cant say! maybe tomorrow it can shoot up to 468!!! or drop to 428