Options Trading

satya_pinku2003 · #41 15th February 2008, 11:19 AM

Quote:

Originally Posted by aca_trader

Hi Satya!

For trading patterns with options, refer to "K.h. Shaleen - Technical Analysis & Options Strategies". It's a very good book with specific refernce to adoption of different market strategies when patterns are developing or have broken out.

Best Regards,
--Ashish

Thank you Ashish hope you will restart you thread on pattern and can tel some option strategies with it

Regards
Satya

aca_trader · #42 15th February 2008, 03:53 PM

Quote:

Originally Posted by satya_pinku2003

Thank you Ashish hope you will restart you thread on pattern and can tel some option strategies with it

Regards
Satya

My pleasure Mate!

Hope I am do it some time in future.

Best Regards,
--Ashish

aca_trader · #43 15th February 2008, 04:19 PM

Quote:

Originally Posted by sanjugalande

fends i am frequent option trader yet as a learning it
my doubt is
1. in option it is always said that writting/selling option has unlimited loss
2.but when i sell nifty call(CE) there is no risk of excerise buy buyer till expairy day so though nifty goes up for week and come down after that i remain in profit... how does line 1. relates to this?

Naked option selling has unlimited risk. IF one is writing a call & underlying moves above the strike price, the writer will start facing losses (net-off premium received). As there is no limit to which prices can rise, there is always an unlimited risk.

Specific to your strategy, there are a couple of risks:-

1. If NIFTY does not come below the strike price before expiration, you will face losses. Even if one thinks of rolling it over every month till price comes to his level, it may take years.

2. If NIFTY keeps on moving up, your MTM losses may be more than the capital in your account and that particular day, your broker will square off your position and you will loose your entire capital.

Quote:

3.if i sell stock call (ca) and somebody excercise his call how is buyer selected by exchange when some one excercising his call?

thxs

....sanju!!

This selection is made by computers on a random basis. Any of the writers may be the unlucky person.

Best Regards,
--Ashish

satya_pinku2003 · #44 15th February 2008, 04:31 PM

Is there any value remain in call/put option on the expiry day .......... ?? if so can we sell them on that day to get the little premium ?

again now we can sell 4800/4700 nifty as it seems market may not come down to this level

need comment

Regards
Satya

aca_trader · #45 15th February 2008, 04:50 PM

Quote:

Originally Posted by satya_pinku2003

Is there any value remain in call/put option on the expiry day .......... ?? if so can we sell them on that day to get the little premium ?

The little value will most probably be lesser than the brokerage payable.

Quote:

again now we can sell 4800/4700 nifty as it seems market may not come down to this level

need comment

Regards
Satya

Put options can be written for these levels. Further, as the IV is still much higher compared to HV, the option premiums are at mouth-watering level.

Best Regards,
--Ashish

satya_pinku2003 · #46 15th February 2008, 05:00 PM

Quote:

Originally Posted by aca_trader

The little value will most probably be lesser than the brokerage payable.

Put options can be written for these levels. Further, as the IV is still much higher compared to HV, the option premiums are at mouth-watering level.

Best Regards,
--Ashish

Thank you Asish
but how you calculate Implied volatility and historical volatility
any site maintain these things please inform ?

Regards
Satya

aca_trader · #47 15th February 2008, 05:17 PM

Quote:

Originally Posted by satya_pinku2003

Thank you Asish
but how you calculate Implied volatility and historical volatility
any site maintain these things please inform ?

Regards
Satya

With any option calculator and NSE Bhav Copy, you can calculate IV for different options. Further, both ODIN & PIB provide Option Calculators.

I will suggest purchasing this cheap Option Caluculator & Simulator.
http://www.kaininito.com/options/index.html

Usually, Volatility of actively traded option is 25-35% and that is my guidance level for judging comparative IV of options.

Regards,
--Ashish

sanjugalande · #48 16th February 2008, 01:18 AM

Thank you Asish

means if i write option , i have to settle M2M profit/loss on same day?..as like in futures

further qurey
what is stamp paer duty and taxes for option trading ?...does they vary with different broker or they are std?
till date i can't understand how taxes/service chaerge etc calculated by kotak securities(in which i trade)

..if u know plzz share

thanks
...sanju!!

angel_on_earth · #49 16th February 2008, 08:23 AM

Quote:

Originally Posted by aca_trader

My pleasure Mate!

Hope I am do it some time in future.

Best Regards,
--Ashish

Hello Sir

A kind request ... Can you please guide new traders like me to get into
options trading. I'm still confused on whether to boy 'OTM' or 'ITM'.

In the past I've lost some money as the market did not rise according to my
expectation.

Thanks in advance.

kkseal · #50 16th February 2008, 03:03 PM

Quote:

Originally Posted by aca_trader

... Usually, Volatility of actively traded option is 25-35% and that is my guidance level for judging comparative IV of options.

Useful. Thanks.

Regards,
Kalyan.