Low Risk Low Returns- Target 50 NF per month per NF Lot

jamit_05

Well-Known Member
#1
Concept

Long NF, covered with a couple of PEs. Risk is completely covered.

PEs because they are dirt cheap compared to CEs at this point in time.... @40% sale!



Target​

We intend to earn 30 to 50 points per NF lot. With COVERED risk and minimum effort.

We will be acting EOD (mostly).

Idea is to act when market goes at an extreme against the trend and take profit as it normalizes. In this, we want to pull out a difference of around 50 points per lot.

In this manner, we assume we will get ONLY 5 chances in this period of 2 months to extract our profit and time-decay. In the last month, we will sell the PEs to avoid max. decay.

Lets see how it goes.
 
Last edited:
#3
Hi jamit,

Can you please elaborate what action you plan to take if the market goes up 50/100/150/200 points or come down by same amount....any liquidation /rollover strategy you have in mind ?

Looks interesting....if it can be done, there is large money waiting for risk free deployment which will make it earn say 30-40 % per annum but with no risk.

Smart_trade
 

jamit_05

Well-Known Member
#4
Hi jamit,

Can you please elaborate what action you plan to take if the market goes up 50/100/150/200 points or come down by same amount....any liquidation /rollover strategy you have in mind ?

Looks interesting....if it can be done, there is large money waiting for risk free deployment which will make it earn say 30-40 % per annum but with no risk.

Smart_trade
Cost for PEs is 220 per Lot. If NF moves that much then will buy another set of ATM PEs of 2 month forward. Other than that, the core idea is to act at reversals from anti-trend moves.

As you see, knowing of the prevailing trend in NF becomes important. Opportunities to extract profit are few... only 5 to 7 in a 2 month period.
 

DanPickUp

Well-Known Member
#5
Where is the analyzing picture? Covering the idea with puts is not enough to bring it over or at the zero line. So please show the analyzing picture before creating big words.
 

comm4300

Well-Known Member
#6
I am not taking real positions, hence the thread is in the Diary section.

Entered Long NFs 5 Lots at Feb NF 6038;
Purchased 10 Units of 6000 APR PEs @ 110

Cost incurred: Rs. 58000 inclusive of all expenses.
Cost of option purchase 110*50*10 = 55000
Cost of NF 5 lot long [assuming 35000 EOD margin] = 1,75000

iam i missing something here?

thanks
 

DanPickUp

Well-Known Member
#8
Hi jamit,

Can you please elaborate what action you plan to take if the market goes up 50/100/150/200 points or come down by same amount....any liquidation /rollover strategy you have in mind ?

Looks interesting....if it can be done, there is large money waiting for risk free deployment which will make it earn say 30-40 % per annum but with no risk.

Smart_trade
Dear ST

Are you sure that any body is willing or even is going to show such kind of trading for free in the last details in any forum?

Giving a hint is allowed and all the rest would be more than called stupid.

Good trading / DanPickUp
 
#9
Dear ST

Are you sure that any body is willing or even is going to show such kind of trading for free in the last details in any forum?

Giving a hint is allowed and all the rest would be more than called stupid.

Good trading / DanPickUp
Hi Dan,

In this forum and in many other forums great ideas are shared. We need a hint or an idea which we can adapt and develop further...something like sell futures/cover puts so as to make the total position delta neutral when the market moves in any direction....or something else....

I am sure such a method can evolve if people like you who are knowledgeable in options can share their ideas......look forward to inputs from you and other option traders.

Enjoy...

ST
 
#10
I am not taking real positions, hence the thread is in the Diary section.

Entered Long NFs 5 Lots at Feb NF 6038;
Purchased 10 Units of 6000 APR PEs @ 110

Cost incurred: Rs. 58000 inclusive of all expenses.
You are holding these positions, aren't you ? So how come your expenses are so less ?

The cost of 5 lots NF @6038 would be Rs. 150950 and for 10 lots 6000PE @110 will be Rs. 55000.

So, the total cost should be Rs. 205950 + expenses.

Am I missing something ?
 

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