my option strategy .

My option strategy
strat from 1st day of new series .
1st step -- assume nifty price is 5000 .
2nd step-- i sell 4800 put and 5200 call .

Nifty assume close at or above 5100 in any of next trading sessions .
My 3rd step exit from 5200 call and sell 5300 call and 4900 put .

Assume nifty close at or above 5200 in next trading sessions .
My 4th step exit from 5300 call and sell 5400 call and 5000 put .

Assume nifty close at or below 5100 in next trading sessions .
My 5th step exit from 5000 put and sell 5300 call and 4900 put .

Do same till expiry with movment of every 100 points .

My diffrence is 200 up n 200 down safe traders can trade with 300 points diffrence .

According to me no loss in this strategy but i am not sure about it .

Please share your views about risk or about your experience .

Sounds interesting. Have I understood correctly!!
Though with all Short positions you have Limited upside and unlimited Downside risk!!!

Nifty ~5000
Your starting position is -4800PE and -5200 CE

Nifty ~5100
Then Positions in hand : -4800PE,-4900PE and -5300CE (5200CE is squared)

Nifty~5200
Then -4800PE,-4900PE -5000PE and -5400CE (5300 CE is squared)

Nifty ~5100
Then -4800PE,-4900PE, (5000PE sqrd),-5400CE and -5300CE

We have max 4 Short open positions in options on any given day,

Now can you speculate what would be your Open position on 15th May 2009 and your action on 18th May!!
I do know such are extreme scenarios and rare but they seem to eat in to large chunk of your profits. So instead of having all short positions in Options, how about buying some deeper out of money options to hedge our position!!
Am not very much versed with options and my view are that of a newbie.

Regards

rkkkarnani dear friend ........ yes you are right lot of risk when uper circuit and lower circuit happen but please think we can idea about that kind of conditions and only that time we can buy deep out of money options for hedging .

Your initial strategy is short strangle with 200 points OTM option. For any moment in Nifty +/- hundred points you cover your loss in OTM (100 points) option and short another OTM (200 points) option. Thus for every 100 points moments you will be booking loss, which would sort of wipe the premium.

Try doing some paper trading or doing simulation win volatile month.

Also consider instead of covering loss, book profit on OTM (300 points) keeping OTM (100 points) option as hedge against reverse diretion of market.

I'm also newbie regarding options.