BankNifty Weekly expiry >> my strategy

#1
I don't know, this thought came in my mind and I am putting it here for your valuable feedback. I have not implemented it.

On the last day and last hour of weekly expiry of BankNifty the OTM options fall close to 0.50/-.
At this time if we short next week's deep OTM and close it on the same day. Because in 1 hour the index will not fall or rise 400-500 points.

Please let me know your feedback/opinion on my thought.
 

nac

Well-Known Member
#2
What do you mean by weekly expiry? I don't get it.

Assuming you short sell OTM BANKNIFTY in the last hour on expiry day for 50 paise. If this is what you're asking, you're blocking too much money as margin for gaining 50 paise and I don't know if that 50 paise will be enough to cover charges/brokerage.

If you short sell next month's OTM BANKNIFTY in the last hour of this month's expiry and cover it before close, you will realize profit or loss depends on price movement. What's the strategy here :confused:
 
#3
Wizetrader,
Perhaps, you don't trade Options. If you trade too, perhaps you were not seller. For Rs. 20, will you keep aside minimum Rs. 15k? Forget about hedging it. The other contract may show you a variation of 2-10 points within seconds, evenif price does not move as Banknifty IVs move wierdly
 

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