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

6/1
Sold
12050 PE 30JAN 140
12000 PE 30JAN 150

Covered
2 lot NF 12115 --> Gain: 280 pts

7/1

Sold 2 lots 12200 30Jan 48
Bought 2 lots 12500 30Jan 12
difference 36*2 = 72 pts Gained.


Spreads

Covered Call Spread:
Buy CE 12200 16Jan 20 Lots @ 115 --
Sell CE 12500 30Jan 20 Lots @ 45 --
Squared off two pairs gained 70 pts -- Balance 18 Pairs

Short NF
20 Lots @ 12255 (Premium: 35 pts) -- Balance 18 Lots
Gain: 280 Pts


Sold
12050 PE 30JAN 140 6/1
12000 PE 30JAN 150 6/1
12050 PE 30JAN 155 7/1
11950 PE 9 Jan 45 8/1 Expired
Collected 490

In this confusion over US-Iran, we collected 70+490+280 points = 860 points.

Action 9/7

Squaring off one entire set
Sell 2 lots 12200CE 30Jan 145-115=30*2 pts gain. Taking advantage of high volatility
Buy 2 lots 12500CE 30Jan 45-30= 15*2 pts gain.
Cover 2 Nf 12255-12195=60*2 pts gain. Trend might change. Lets take of whats left.
---------
Total gained: 60+30+120=210 pts.

Complete gain: 860+120 = 980 points.

But...

with 16 NF in hand of 12255 and CMP 12255 --> breakeven

Covered Call Spread:
Buy CE 12200 16Jan 20 Lots @ 115 CMP 150 100 --> loss 50 points = 800 points loss.
Sell CE 12500 30Jan 20 Lots @ 45 CMP 40
------------------------------
Total Loss 800 points

Grand Total comes to a loss of 980-800 = 180 points of profit

Position squared off! at a notional profit of Rs.216000 :)
I was never ever able to understand your trades.. tried so hard and tried so fast.. :)

jokes apart. could you please explain the logic of covered call ? and how exactly you manage/ like if gap up gap down.. do you take any ta in consideration or stuff like that pls ?
 

jamit_05

Well-Known Member
I was never ever able to understand your trades.. tried so hard and tried so fast.. :)

jokes apart. could you please explain the logic of covered call ? and how exactly you manage/ like if gap up gap down.. do you take any ta in consideration or stuff like that pls ?

The concept is really simple; I couldnt handle complicated.
Yes TA is used to get the trend on the daily chart.

Once trend changed to down, I shorted NF and covered the entire position with same number of CEs. As a result, we are making sure that the loss is not "infinite". And to bring down the cost of this set, I sold some really far away CEs of 12500.
 

jamit_05

Well-Known Member
Starting a new Set, with renewed enthusiasm.
Low risk Low returns is the theme.

Buying 30 Lots of

CMP 12355
12500CE Mar @265
12500PE Mar @310

Expected time decay is of 115*30 = 3450 points in a month.

Since time decay is going to be 115 points per set, per month, our goal is to sell options against our purchased set, such that we get anything more than 115 points.
 

jamit_05

Well-Known Member
Buying 30 Lots each of

Nifty Spot 12352
12500CE Mar @265
12500PE DEC2020 @515 (dirt cheap considering it is already 150 points ITM)


SOLD
12500CE 6Feb @121 will decay by 80 points in a week
12350CE 23Jan @68 will decay by 68 points in a week.
 
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jamit_05

Well-Known Member
I expect some downside... therefore the two bearish spreads.

Spread 1:
BUY 30Jan PE 12350 @85
Sell 30Jan PE 12200 @35
Cost 50 points..... potential 150 pts.

Spread 2
Sell 6Feb 12500CE @118
Buy 23Jan 12500CE @14
 
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jamit_05

Well-Known Member
12500PE DEC2020 @515
is dirt cheap considering it is already 150 points ITM. If it expires instantly, then the premium value for
12500PE DEC2020 becomes 365

and
12500CE DEC2020 is away at 860+150=1010

look at the disparity. IDK what the market is anticipating, if doesn't happen then this correction is possible.
 
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jamit_05

Well-Known Member
With that said ...
Now is a good time to buy long term PEs since they are cheap. And sell long term CEs as they are expensive.

If you must buy CEs, they but short term ones and quickly cover them at the first chance.
 

jamit_05

Well-Known Member
Spread 1:

BUY 30Jan PE 12350 @85
Sell 30Jan PE 12200 @35
Spot 12224

Complementary Trade:
Sell 27Feb 12100PE @178
Buy 30Jan 12100 PE @56
Difference 120
Spot 12185



Spread 2

Sell 6Feb 12500CE @118 cmp 85
Buy 23Jan 12500CE @14 cmp 4
Buy 30Jan 12500CE @14



Adding a complementary trade...

Sell 12000PE 6Feb 82
Buy 12050PE 30Jan 32

Means,

Till 6Feb if price remains in between 12500//12000, I get 50+90 Beyond that I hv cover
 
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jamit_05

Well-Known Member
Buying 30 Lots each of

Nifty Spot 12352
12500CE Mar @265
12500PE DEC2020 @515 (dirt cheap considering it is already 150 points ITM)

Actions
Sell 12200PE 27Feb @210 at Spot 12214

Shthe overall strategy would be to buy what has low time decay and sell what has a high time decay and Pocket the difference
 

jamit_05

Well-Known Member
I see price making a 100 point bounce or going sideways for the entire week.
And in the next month or so, it might even touch 12500.
So playing accordingly:

Spread 3.
With the view of an upmove or sideways in a week:

Sell 12100PE 6Feb 125
Buy 12100PE 30Jan 50
Spot 12175

This is to be ended before 28th Jan. In the meantime, if price goes up will make a complementary trade to retain the difference of Rs.75, However the upmove should happen before Tuesday.

Spread 4
With the view of a month:

BUY 12200CE 27FEB @260
Sell 12400CE 6FEB @87 (expected to decay v.fast, around 60 points a week)
Paid: 175


Spread 5
Spot 12170
Setting Limit for price movement,
Upper Limit 12500
Lower Limit 11500 (since bears can get a little fearful sometimes)

For Upper Limit:
Sell 12500CE 27Feb @ 124
Buy Cover 12350CE 30Jan @ 33
Collected: 90 points.

For Lower Limit:
Sell 11800PE 27FEB 91 (11500 has no premium value... will get to it if price moves such)
Buy Cover 11900PE 30Jan 20
Collected: 71 points

If a weeks time will have to readjust the "Cover" legs to protect premium value.
 
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