Averaging out future position

#1
Hi,

Please go through the below and let me know either averaging out future is beneficial or not.

Assume I bought BankNifty Sep Future @ 23600

I will close in profit if banknifty is moving upside. But I will have loss if moving downside.

When banknifty is down by at least 500 points
Buy 2 lots banknifty Sep future @ 23100 x 80 (2 Lots)

So, my average cost for buying future will be: 23600+23100+23100 = 69800/3 = 23266 which is my breakeven point now instead of 23600 (first purchase)

And there are chances of market reversal after 500 points downside. Once banknifty is above 23266 I will take benefit of 3 lots future.
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Hedging:

For each 1 lot future position we can buy 4 lots 500 points away OTM PE. It will benefit us from a big downside.
 
#3
Brother, I am not averaging out on each 10 points move. I am averaging out on each 500 points move. And I am also buying 500 points away 4 lots of PE with each lot of future. So, I already know the maximum loss I will have. not playing for unlimited loss.
 

copypasteaee

Humbled by Markets
#5
Deleted....
 
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suktam

Active Member
#7
Hi,

Please go through the below and let me know either averaging out future is beneficial or not.

Assume I bought BankNifty Sep Future @ 23600

I will close in profit if banknifty is moving upside. But I will have loss if moving downside.

When banknifty is down by at least 500 points
Buy 2 lots banknifty Sep future @ 23100 x 80 (2 Lots)

So, my average cost for buying future will be: 23600+23100+23100 = 69800/3 = 23266 which is my breakeven point now instead of 23600 (first purchase)

And there are chances of market reversal after 500 points downside. Once banknifty is above 23266 I will take benefit of 3 lots future.
===========================================================

Hedging:

For each 1 lot future position we can buy 4 lots 500 points away OTM PE. It will benefit us from a big downside.
hi
always average in buy position ..and always trade in index.. because chances index to zero is less...
 

augubhai

Well-Known Member
#8
Hi,

Please go through the below and let me know either averaging out future is beneficial or not.

Assume I bought BankNifty Sep Future @ 23600

I will close in profit if banknifty is moving upside. But I will have loss if moving downside.

When banknifty is down by at least 500 points
Buy 2 lots banknifty Sep future @ 23100 x 80 (2 Lots)

So, my average cost for buying future will be: 23600+23100+23100 = 69800/3 = 23266 which is my breakeven point now instead of 23600 (first purchase)

And there are chances of market reversal after 500 points downside. Once banknifty is above 23266 I will take benefit of 3 lots future.
===========================================================

Hedging:

For each 1 lot future position we can buy 4 lots 500 points away OTM PE. It will benefit us from a big downside.
Hi,

I had done some similar tests in 2013. I still have some hope on these systems, and may look at them again....

Check the link below. This posts and a few posts after that are about my Martingale test results on Nifty Spot. The results are good most of the time, but at some point, events conspire to increase the number of lots exponentially.
daSARa system
 
#10
New position opened @ 13:29
Banknifty Spot: 23593

Bought Banknifty July Future @ 23665
Bought 13July 23100 PE @ 12.60 x 4 lots

Will average out our position if banknifty reach 500 points down.

EDIT:
Future was for Aug month not for July.
So, Bought Banknifty AUG Future @ 23665
 
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