Earn 180% profit through nifty strategy

[rajgiri21]

The idea is good Giri . Not doubt about it. And there will be months where we market will have less whipsaws. To reduce that, we can pick this strike price when it is bouncing back from a good resistance or up from support. 100 points is less or more, depends on the time frame we are planning to watch/trade. I am sure we will learn something from this thread.

Humble request to change the title, if you are ok. Cause that is not the main goal for any of us I believe .

Yeah Gunsho tat seems to be gud idea!! and i have learnt alot from this thread!! Thanks!!! And btw yeah i made tat title to attract ppls opinion!! But it seems i cant change the title.. is it so, then how?

 

[DanPickUp]

Dear Dan,

Thanks!!! Yeah if i sell a put i wil be getting the premium of tat as well!!! But again does tat increase my risk?? coz as it looks my call n put will give me the total time premium of both the options!! But why would i need a nifty future then wont i make loss in that or is tat covered??

Sorry if am found naive, am a bit new to these hedging strategy n all!!

Works in sideways market and is out of question in trendy markets.

 

[rajgiri21]

Giri, you will find answers in below post. Nicely explained with pictures.

http://www.traderji.com/futures/41903-target-500-nifty-points-per-month.html#post443841

Thanks Gunsho!! Learnt alot frm tat thread!!! would try tat out!!! thanx again for ur time n guidance!!!

 

[rajgiri21]

Works in sideways market and is out of question in trendy markets.

Thanx dan, yeah it works on sideways market but on oneside it wont!! i prefer i stay away frm tat n implement this simple idea of mine to make some profits!!! Thanx again!!!

 

[DanPickUp]

Thanx dan, yeah it works on sideways market but on oneside it wont!! i prefer i stay away frm tat n implement this simple idea of mine to make some profits!!! Thanx again!!!

Any time welcome and thanks to bring up such ideas in your home market. Hope others recognize the value of the thread.

 

[newbe]

Whipsaws will kill you...thats a loop hole

 

[DanPickUp]

Whipsaws will kill you...thats a loop hole

Wrong, as long as there are no trades are done.

Good learning

DanPickUp

 

[jain.er]

Will reply to whipsaw thing tomorrow, currently the mind refuses to work...

 

[rajgiri21]

Whipsaws will kill you...thats a loop hole

Why would tat kill me? I am just staying away frm trades n whenever thr is downside i wil exit... I dont understand how it can happen?

 

[linkon7]

Here goes my thought:

Step 1: Buy Nifty futures for the near month say now Nifty 31Aug 2012 @ 5265

Step 2: Sell "in the money" option say 5200CE 31Aug2012 @ 165

Thats it!!! Whenever market falls below 5200 sell nifty and once it comes back to 5200 buy it!!

Your intention is to exit nifty below ur strike price... and buy it back when it climbs above it.

I would rather Initiate a Naked 5200 put short.

When I initiate the naked put short, my view would be that NF will take support above 5215, the low of the day, when we gap-ed up and extended the whole EOD trading range upwards. Everyday, the market dynamics change and depending on my current view, my action point can be to

short nf below 5200 and make it a covered put..
or
buy 2x 5100 put and make it a ratio spread...
or
buy 5300 put and make it a bear spread...

The potential profit /loss curve of your covered call (nf long + 5200 call short) is exactly the same as my naked 5200 put short...! Difference is in the variety of action points.

Trading options is a whole different ball game. There has to be room to alter the delta of your positions and you have to cater to all what if scenario...