Moneycontrol BankNifty Option Strategy -- Query regarding P/L

amrutham

Well-Known Member
#1
Today while going through MC, I came across below BankNifty Option Strategy.


MoneyControl_BNStrategy.png





Source: https://www.moneycontrol.com/news/b...-on-bank-nifty-in-truncated-week-2559643.html

Margin required for this strategy is 60K+ and Max Profit =around 16k if BN closes above 26000 by expiry. Max loss is around 4K if BN closes below 25500.

My doubt is the same P/L can be achieved by simply buying BN 25500 CE at LTP of around 90.

Am I doing my calculations wrong?
 
#2
hi good evening amrutham,

calculation is correct just the LTP is not correct it is 160 and 560.
pay off is true anything below is 4k loss and anything above 26000 is 16k profit. breakeven 25600.

negative points - position delta -63 and theta -1410 ( some calculation error )- don't know if actually it is true.
but point- 1)- if you can actually get this range on trading terminal is one point.\
point 2 )- margin required is over 1.15 Lakhs ( premium recievable is to be covered in margin exposure- so 560 *40- 22000 is also +deep in money span is much bigger.

R/R= 3.7/1 ( true) - IDEALLY & if only you are too bullish on nifty - ACTUALLY anywhere near 25800 or 25850 - if you try to close the position OTM will not give any and ITM will loose STT discount. and at 25800 ideally should have 200 points but can only get 170 or 160- which makes R/R = 1.45/1 = in 3 days can take this bet. but hell lot of margin required.

happy trading tomorrow.
 

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