my option calls
- Thread starter bandlab2
- Start date
yes you could. but you need margin money to cover the sell. risk is unlimited in sell. in my trades, i sold both call and put. so the loss is limited to certain extent as long as we are within 3000-3800 range (i sold 3400 call, put and collected 400 rs). if nifty goes below 3000, i will start making loss. if nofty stays as close to 3400, i stand to gain more
dot jump with trades, do it on paper first
dot jump with trades, do it on paper first
Short 3400 Straddle trade --> My resoning of 17-Oct post for being +ive on this trade has been proven wrong by market. The current market situation has fallen in the 25% part as per my analysis. Currently the straddle cost is 800+. That made me think, about the various adjustments that we could have done to mitigate the risk on this position.
1) what if we had Bought 3100 or 2950 put from the small part of 400 Rs premium that we had collected
2) what if we had convered this from short straddle to short strangle by by selling 3000 PUT and buing back 3400 put
3) what if we had Just closed it whatever little profit that we got and violated our rule of letting profit run..
Would like to get the views from others on strategy adjustment.
Happy Trading.
(A loosing trade does not make a trader, looser.. It is just another trade).
1) what if we had Bought 3100 or 2950 put from the small part of 400 Rs premium that we had collected
2) what if we had convered this from short straddle to short strangle by by selling 3000 PUT and buing back 3400 put
3) what if we had Just closed it whatever little profit that we got and violated our rule of letting profit run..
Would like to get the views from others on strategy adjustment.
Happy Trading.
(A loosing trade does not make a trader, looser.. It is just another trade).
1. Its a good idea but when and at what price it was possible?
2. When market shows clear down trend I think it wont be a wise decision and it adds more transaction costs and brokerage.
3. I think it was the best strategy available as I mentioned earlier. Here the major concern is as you told the huge ATR. Due to this huge range we will not be able to keep a 100 Rs. stop loss which was the strategy as per Bandla. Because by opening it self we could be in a big loss.
Further it is important that due to this huge ATR we have to keep a large amount of margin with our Broker if we are writing options. By the same amount required for writing one straddle, we can buy two straddles. If the market doesn't trend, dont wait till the expiry, book profit when ever you get a good move in either direction.
Regards
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