box spread (long) option strategy query

[trader1899]

jp associates (stock price 45rs)

BUY nov. 40 call (ITM)= 6.00 (lot size=4000rs)
SHORT nov. 40 put (OTM)=.55
SHORT nov. 50 call (OTM)=.60
BUY nov. 50 put (ITM)=4.85
_____
total cost of box 38800 rs

expiration value of the box= (50-40)x4000=40000

40000-38800=1200 profit

jp associates (stock price 47.45 rs)

BUY nov. 40 call (ITM)= 7.50 (lot size=4000rs)
SHORT nov. 40 put (OTM)=.20
SHORT nov. 50 call (OTM)=.95
BUY nov. 50 put (ITM)=3.15
_____
total cost of the box =37920 rs

40000-37920=2080rs

is this strategy correct.??

this is theoritical application with correct prices at that moment.
can i use this strategy practically?

what will be my breakeven and maximum profit
(plz also tell me how u calculated it.)

this a arbitrage strategy,so what if when i buy the itm option and short otm options and instantly square them off (doing opp. of what i did before)
can i earn a arbitrage profit?, if not where am i wrong

i am trying to learn so senior please help me.

 

[jagankris]

jp associates (stock price 45rs)

BUY nov. 40 call (ITM)= 6.00 (lot size=4000rs)
SHORT nov. 40 put (OTM)=.55
SHORT nov. 50 call (OTM)=.60
BUY nov. 50 put (ITM)=4.85
_____
total cost of box 38800 rs

expiration value of the box= (50-40)x4000=40000

40000-38800=1200 profit

jp associates (stock price 47.45 rs)

BUY nov. 40 call (ITM)= 7.50 (lot size=4000rs)
SHORT nov. 40 put (OTM)=.20
SHORT nov. 50 call (OTM)=.95
BUY nov. 50 put (ITM)=3.15
_____
total cost of the box =37920 rs

40000-37920=2080rs

is this strategy correct.??

this is theoritical application with correct prices at that moment.
can i use this strategy practically?

what will be my breakeven and maximum profit
(plz also tell me how u calculated it.)

this a arbitrage strategy,so what if when i buy the itm option and short otm options and instantly square them off (doing opp. of what i did before)
can i earn a arbitrage profit?, if not where am i wrong

i am trying to learn so senior please help me.

Above examples seems to be correct.
But STT has to be calculated for the options - pls check if
STT value < 1200 rs or you will end up in loss.

Currently
JP ass - 54 rs
50CE - 6.35
60CE - 1.50
60PE - 7
50PE - 1.90

So Long(CE+PE) - Short(CE+PE) = 6.35+7 - 1.5 - 1.9 = 9.95.
Net profit 10 - 9.95 = 5 paise * 4000 = 200 rs.
But STT will be much more than the profit.

 

[trader1899]

Jagan ji can u please answer the other question too, specially the arbitrage question? ?

I am not thinking about the stt now. Just checking if it can work properly.
I will try this strategy in oder stock options.