I have been toying with this idea from last couple of months and wanted to know if a feasible strategy can be implemented to get sizeable profit from options trade.
1. To trade options during the expiry day
2. Collect data from historical expiry days, Open Interest and Pricing Patterns
3. Arrive at possible expiry range - This is not a technical chart game. This is pure hunch if you see last three/four expiries.
4. Take a position after all due diligence (this is a go/no go situation). Stop loss wouldnt work, as the price will fluctuate largely.
5. WIN/LOSS strategy - either reap good profit or forget your investment (Speculation)
6. Finally the whole strategy depends on probability game (if we perfect a strategy to a level that we can get 50% of trades right in our favour with 300% profitability, other trades expire worthless). We can get 50% profit on our portfolio.
Question is, can a strategy be developed around this. What is the viability and probability of success in this.
Any views/ideas from peer groups. I do not know the answer, but it think this may workout if analyzed properly.
Finally what excites me is the expiry of the Nifty 3050 Call option in March 2009. Attached is the screenshot.
1. To trade options during the expiry day
2. Collect data from historical expiry days, Open Interest and Pricing Patterns
3. Arrive at possible expiry range - This is not a technical chart game. This is pure hunch if you see last three/four expiries.
4. Take a position after all due diligence (this is a go/no go situation). Stop loss wouldnt work, as the price will fluctuate largely.
5. WIN/LOSS strategy - either reap good profit or forget your investment (Speculation)
6. Finally the whole strategy depends on probability game (if we perfect a strategy to a level that we can get 50% of trades right in our favour with 300% profitability, other trades expire worthless). We can get 50% profit on our portfolio.
Question is, can a strategy be developed around this. What is the viability and probability of success in this.
Any views/ideas from peer groups. I do not know the answer, but it think this may workout if analyzed properly.
Finally what excites me is the expiry of the Nifty 3050 Call option in March 2009. Attached is the screenshot.
