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3 Option Strategies Tested Here

Discuss 3 Option Strategies Tested Here at the Options within the Traderji.com - Discussion forum for Stocks Commodities & Forex; Originally Posted by nareshch I do not see any profit in these strategies until unless ...


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  #21  
Old 13th July 2008, 12:59 PM
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Default Re: 3 Option Strategies Tested Here

Quote:
Originally Posted by nareshch View Post
I do not see any profit in these strategies until unless there is a wild one way move . Break Even for Strategy1 Is Either nifty above 4471 or below 3729 and alsmot same for other strategies .

Am i understanding these strategies correctly ????????????????


Naresh
Your question shows that you have understood this correctly.
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  #22  
Old 13th July 2008, 02:19 PM
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Default Re: 3 Option Strategies Tested Here

Quote:
Originally Posted by beginner_av View Post
Your question shows that you have understood this correctly.
iam making money on strangle from long time...yes time decay has important role and i agree wild moves in one direction is required!
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  #23  
Old 13th July 2008, 06:16 PM
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Default Re: 3 Option Strategies Tested Here

GUNAVADHI,

I follow these strategies , but when you want to prolong the positions for 10-15 days its not advisable to buy the options but to sell thse options.
You are going to get the advantage of time decay to add to yr profit.
Buying options in these strategy may be done only for a period of 3-4 days , not more.
your advise pl

SVK11
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  #24  
Old 13th July 2008, 08:46 PM
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Default Re: 3 Option Strategies Tested Here

Quote:
Originally Posted by svk11 View Post
GUNAVADHI,

I follow these strategies , but when you want to prolong the positions for 10-15 days its not advisable to buy the options but to sell thse options.
You are going to get the advantage of time decay to add to yr profit.
Buying options in these strategy may be done only for a period of 3-4 days , not more.
your advise pl

SVK11
i agree.....but it can be carried long if u have entered in next month options or ur current month expiry is 22 -25days far...
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  #25  
Old 14th July 2008, 11:35 AM
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Default Re: 3 Option Strategies Tested Here

Hi All,

I have found one problem in this model

4017 - - 103+195 - - 66+138 - - 104+205

When call premium price is less compare to put premium price in this situation if market start going up then put call price get reduce by 2 points where call price get increase only for 1 point. End of day you only get loss if market close on high

Avoiding provided situation what I have done:-

I have started taking 2 contracts of call and on put for balancing the premium price in this situation I get relief and equal profit when price will get close on high

Disadvantage doing this:-

1)We need to pay more brokerage
2)We need more money for investment


Please let me know your comments
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  #26  
Old 17th July 2008, 01:37 PM
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Default Re: 3 Option Strategies Tested Here

I took a strangle yesterday when nifty was at 3800.

3800 C ( 122 ) , 3800 P ( 145 ) -

Total cost : 267

Sqaured of today a little while ago ( not at same time )
I squared off 3800 p (102) ,when nifty crossed 3900 around 12:15 Pm
and 3800c ( 205 ) when nifty struggling at 3940 .

Total : 307 . profit around 35 points after brokerage .

More than 10% on capital

Naresh
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  #27  
Old 17th July 2008, 03:16 PM
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Default Re: 3 Option Strategies Tested Here

Bought Strangle 3900

3900C - 142
3900P - 130
Total Cost - 272

Naresh
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  #28  
Old 17th July 2008, 04:32 PM
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Default Re: 3 Option Strategies Tested Here

Quote:
Originally Posted by nareshch View Post
Bought Strangle 3900

3900C - 142
3900P - 130
Total Cost - 272

Naresh
A strangle is made up of a call and a put with different strike prices (when all other factors remain the same). By the looks of it, you seem to be going in for a straddle. Correct me if I am wrong.
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  #29  
Old 17th July 2008, 06:26 PM
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Default Re: 3 Option Strategies Tested Here

Quote:
Originally Posted by skarpio View Post
A strangle is made up of a call and a put with different strike prices (when all other factors remain the same). By the looks of it, you seem to be going in for a straddle. Correct me if I am wrong.
You are Correct . Its a straddle .

Thanks for correcting me

Naresh
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  #30  
Old 18th July 2008, 08:21 AM
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Default Re: 3 Option Strategies Tested Here

Hi Nareshch

I am also buying given strategies and its good, giving good profit also. I read more books related this and search on goggle too.

These strategies are very commonly use in US many ppl are earning 2 to 13 % monthly income on total investment.

I just have one point that if there is more then 50 % difference in premium then there is more chance that this strategy doesn’t work.

Check the numerical example:-

Like Nifty 4000
---------------------------------------------------------------
Call is 80 * 50 = 4000
Put is 200 * 50 = 10000
Total is = 14000


End of day
Call is 100 * 50 = 5000
Put is 170 * 50 = 8500
Total is = 13500
------------------------------------------------------------------

In this case if we buy to calls which will cost near 80 * 100 = 8000 and there will be more chances of getting profit using these strategies.

Please let me know if I wrong or you are thinking to use exercise option?
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