My first option buy

[samip2u]

Exercising means... choosing to utilise the option you hold. Exercising is done at Closing price of that option.

At excerise... you get the money credited
Profit = ( Exercise price - strike price ) * lot size

While exercising before expiry, you loose out the Time value of the Option. so traders prefer to square off than exercising.

 

[findvikas]

I am sorry, I missed the point that you are holding October Contract.
But that doesn't change anyother part of my post - i.e. deciding you stoploss limit,
forming view on current trend of Suzlon, option pricing and how it behaves.

As a trader, my suggestion will be to plan your trade and execute your plan. If your plan was to max loose 6k on this.. control your emotion and cut the loss.
you option is already at 5.2 today.. You have to know yourself, can u stay balanced after seeing 10k, 12k loss on this trade, will u be able to pull the trigger on next trade confidently after this trade, what trading belief this expereince will bring to you as a trader,

Trading is lot more then just booking profit. My suggestion will be to cut loss and spend remaining money in learning trading.. Learn to manage the loss and profits will take care of themselves. Otherwise, it just takes 1 loosing trade to wipeout the profits of many trades. .. or just to recover the loss of 1 big trade.. u need to generate many profitable trades.

In trading, you have only 4 outcomes, from your trade..
1) Big Profit
2) Small Profit
3) Small Loss
4) Big loss

And right trading practice is to Avoid (4) Big loss.

If you are asking others opinion, you will always get contradictory views (like here vikas and I are suggesting different actions). Please take your own decisions as the outcome is going to affect only you. Not to Vikas or My account balance.

Happy Trading.

I am with AW about what all he said... lets make sure you avoid BIG losses.

PS.: This just happened to be the case of SUZY that I have vested interest and enough confidence in SUZLON for a upside till 115-125 if not this month then in October for sure.

 

[AW10]

whah is the meaning of EXERCISING OPTIONS?

Bhuppi,
You have already this question in other thread..
Here is the link to my reply there..

http://www.traderji.com/options/32926-leaps-indian-options.html#post360290

Happy Trading.

 

[Esthyle_Raja]

Thanks AW10 & Vikas :thumb:,

I respect your views. I personally believe Suzlon will cross 110 level till the expiry. Lets see... Will take your advices into consideration. I have querries :-

What if suzlon gets down to say 85 in coming days, Will value of my option become zero, although I have whole october in hand ?? and then what if it again goes down to 80 ????

What if after coming own to 85, then It climbs up to Rs. 110 in oct, my option will still exist ???

 

[AW10]

Thanks AW10 & Vikas :thumb:,

I respect your views. I personally believe Suzlon will cross 110 level till the expiry. Lets see... Will take your advices into consideration. I have querries :-

What if suzlon gets down to say 85 in coming days, Will value of my option become zero, although I have whole october in hand ?? and then what if it again goes down to 80 ????

What if after coming own to 85, then It climbs up to Rs. 110 in oct, my option will still exist ???

Suzlon being at 95, if u look at 100 Call, of september, it is quoting around 3 Rs before 15days of expiry.
That shd give u rough idea about the time premium that u can expect for 15days period for 5 rs OTM option.
So if Suzlon comes back to 100 , 15days before oct expiry, the value of your call will be approx 3 rs.
As it goes towards 80, value of this will get lower and lower.. and most likely you won't find any buyer for this. Go ahead and chk out the price of Suzlon 125 CA today and u will know what will happen to your call when Suzlon hits 80/85.

That's why I asked you questions in my first post that how much of pain u can see on it.. (5k, 10k, 15k, whole amount), and when will u decide that trend has reversed.
Market has 3 trend.. Up, down and sideway..
As an Option buyer, if mkt doesn't move in your direction, i.e UP in this case.. u are going to see the deterioration of value. If you hold Suzlon stock, then u have something valuable in hand.. but with OTM option, u are just holding a balloon of AIR in your hand, that too where air is leaking gradually as timedecay.

Plz understand the option pricing.. and the factors that affect it. Do chk out another thread "Low risk option strategy.. " where I have given some of the concepts in more practical terms.

Happy Trading

 

[bloodmoney]

Hi All,

I am trading in options for the past 2 weeks with small capital since i am learning it. Gave decent profit of 20% in 2 weeks. My query is about my current holdings of 11 lots of NIFTY 4700PE Sept series at an avg price of 63rs (CMP:48.65). I want to know your experts views on my holding. I am expecting nifty would slide downside in upcoming week since it has rallied for the past 6 sessions continuously.

Pour in your suggestions experts. Thanks all for your suggestions and views shared here.

 

[findvikas]

Sorry I completely missed this thread otherwise would have suggested you earlier to book your losses.... really sorry about your losses but we are ready for a mega bullish move... maybe 5100-5200 is the closing target for september

 

[bloodmoney]

Thanks for ur reply vikas.. anyway i squared off yesterday with huge loss.. can you suggest me any of the stock options for today??

Can you get me your mail id??

 

[darkstar]

Hello All,

I am new to option world. for past few weeks, I was studying option and did some paper trade...

finally, couldnt stop myself buying one option..here it is

Suzlon Rs. 105 29th October at the premium of Rs. 8.85 (Call).

I guess within the given time limit, this share can reach to that level....

What do you say ?? Till today there was only 6000 qty was traded ( including mine 3000)....This option was introduced today...

Though the closing rate was Rs. 7.75:annoyed:

great hope u will do it great

 

[Esthyle_Raja]

I squarred off that day only.... @50%....

but learnt real time many things. still far way from reasonable level.

lets hope for the best. :thumb::thumb: