NIFTY Options Trading by RAJ

[kcsusha]

Dear Raj Sir,
Infosys results are coming out on 21/7/2015. Everybody knows that
every time Infy results are out, there is very heavy reaction in this
counter. If results are slightly below expectations, operators hammer
it downwards. If exceptionally good, operators take it upwards. Now
there is heavy short-build up( CE ) from Rs 1000 to Rs 2000 levels
where as there is only small build-up and that too only at around
Rs 1000 levels, afterwards there is hardly any build-up by PEs.
Does this suggest that operators are not expecting good result from
Infy? CE 1000 is quoting at Rs 25 and PE1000 is quoting at Rs 22.
How about selling both PE 1000 and CE 1000? I am not an expert
in Options, so do not know the implication of this transaction financially.
If Infy goes up, PE value goes down and profit for us where as CE goes up
and loss for us. If Infy goes down, opposite is the position.
Now how to calculate our profit if Infy goes up or down?

 

[vikram4trades]

Dear Raj Sir,
Infosys results are coming out on 21/7/2015. Everybody knows that
every time Infy results are out, there is very heavy reaction in this
counter. If results are slightly below expectations, operators hammer
it downwards. If exceptionally good, operators take it upwards. Now
there is heavy short-build up( CE ) from Rs 1000 to Rs 2000 levels
where as there is only small build-up and that too only at around
Rs 1000 levels, afterwards there is hardly any build-up by PEs.
Does this suggest that operators are not expecting good result from
Infy? CE 1000 is quoting at Rs 25 and PE1000 is quoting at Rs 22.
How about selling both PE 1000 and CE 1000? I am not an expert
in Options, so do not know the implication of this transaction financially.
If Infy goes up, PE value goes down and profit for us where as CE goes up
and loss for us. If Infy goes down, opposite is the position.
Now how to calculate our profit if Infy goes up or down?

As per my understanding of options, what you need to do in such a situation is build a strategy called as Straddle It involves Buying the same strike call and put, usually ATM options. You benefit from any major movement in such a case.(long straddle to be precise). What needs to be taken into consideration is that the volatility is not already too high, because in such a case, as the price fluctuates, the volatility bubble bursts, and option values come crashing down. So even though prices move, both your Call and Put loose value, and you end up in loss.
If you notice that there is a spike in volatility before result announcement, only then can you think of selling the options.

 

[Help_Mee]

Hi healthraj sir,
can i ask few option question here?

Thanks

 

[Profittaker]

 

[healthraj]

Trading for INFY Results

MAX OI @ 950-1000, Which is the same as Hourly Range

HVOLT is at 26%. Options VOLT is at 38%, which is ~40% more than the normal Volatility. So buying Options for the Result day is not a good idea. So any strategy involving Buying options like Straddle will not work. Any straddle I think should be played and closed today itself. Tomorrow in all likelihood the Volatility might be dropped and the Straddles will lose money.

It is better to go for Strangle Or in otherwords our Pair trading.

So one Can Sell Any Calls outside 1000CE and Any Puts below 950PE.
Better to go For a Neutral Pair (Both CE and PE Premium more or less Same)

For Example SELL 1050CE @ 6.8 and 940PE@ 6.3 - Total Premium of 13

 

[amitrandive]

Profittaker

Is this image included in your latest excel files ?
I downloaded but got a blank in the image area.The image is not updated.

 

[Profittaker]

Profittaker

Is this image included in your latest excel files ?
I downloaded but got a blank in the image area.The image is not updated.

Yesterday only i developed this. But could not finish this work. I think Buywin Sellwin value maybe wrong. After finished all work correctly i will update this .

 

[Help_Mee]

Yesterday only i developed this. But could not finish this work. I think Buywin Sellwin value maybe wrong. After finished all work correctly i will update this .

Hi profittaker,
Are you taking new position today? pair trading?

thank you

 

[amitrandive]

Yesterday only i developed this. But could not finish this work. I think Buywin Sellwin value maybe wrong. After finished all work correctly i will update this .

Thanks for your selfless sharing !!!
:clapping::clapping::clapping:

 

[Profittaker]

Hi profittaker,
Are you taking new position today? pair trading?

thank you

Yes I am having . I have sold 8600CE-8400PE pair @ 96.85. Now its showing 4 points plus [Enter @ Spot : 8575] .

SL Hit Spot @ 8605.
Covered Above Pair @ 107.30.
Net Points Loss : 4.70