NIFTY Options Trading by RAJ

[healthraj]

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Sir ji ,
thank u for the reply
http://prntscr.com/7uwlht ..which is HV here..where to get pe or ce volt...

I use the Value from the Last column - Applicable Annualised Volatility (N)

 

[prabhaag]

I use the Value from the Last column - Applicable Annualised Volatility (N)

Thank you Sir ji and Vijay ji :thumb:

 

[vikram4trades]

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.

Infy result out. Here is the result of entering into a Straddle Strategy:

1000CE + 1000PE = 22 + 25 = 47 Buy At infy Fut = 995

1000CE + 1000PE = 112 + 1.10 = 113.10 After result out (infy = 1100)

Profit = 113.10 - 47 = 66 Points

Investment 47 points, return 66 Points in a day.


I bought only one lot, since I thought it was a bit risky as premiums were high due to inflated volatility. I request Raj or any other senior to please highlight the changes in VOLT for the two days. Personally I don't know what and where to look for.

 

[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

The INFY Options did not go As per above.

Today INFY jumped 10%.
Yesterday close the IV was at ~42%.

The average IV has come back to the HV - ~27% from 42%.

 

[n91guruji]

Once in a while market makers gives jackpot in infy so that next time retail traders will by options & market makers will benefit by that .....!!!! :thumb::lol::clap:

The INFY Options did not go As per above.

Today INFY jumped 10%.
Yesterday close the IV was at ~42%.

The average IV has come back to the HV - ~27% from 42%.

 

[vikram4trades]

Once in a while market makers gives jackpot in infy so that next time retail traders will by options & market makers will benefit by that .....!!!! :thumb::lol::clap:

Whether this is once in a while jackpot, or a regular affair during result days remains to be seen by me, since I am too new to options.

However, today Sun Pharma results were also declared.
It went down from 950 to 850

Straddle applied to Sun Pharma:

Buy 940 CE + PE = 19 + 9 = 28 Points ( Yesterday near Day end)

Sell 940 CE + PE = 111 + 1 = 112 Points ( Current Trading Values)

Profit = 112 - 28 = 84 Points

Investment 28 points, Return 84 Points in 1 day ( 3 times)

Another jackpot from the market makers.

(implied volatility remained at ~ 45 levels, which I agree is on the high side)

 

[rajesh0000]

Straddle applied to Sun Pharma:

Buy 940 CE + PE = 19 + 9 = 28 Points ( Yesterday near Day end)

Sell 940 CE + PE = 111 + 1 = 112 Points ( Current Trading Values)

Profit = 112 - 28 = 84 Points

Investment 28 points, Return 84 Points in 1 day ( 3 times)

Plz recheck.

Thanks
Rajesh

 

[anilnegi]

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

If someone traded this contract today it would be
1050 CE @ 72.10
940PE @ 0.90

Selling may be disastrous here but buying not it may fetch profit of 5 x in lone lot

 

[vikram4trades]

Plz recheck.

Thanks
Rajesh

Hi Rajesh.

Please correct me on what you felt was wrong. I rechecked and did not find anything worth correcting. Can you be a bit more precise?
Thanks

 

[rnmathur4965]

Straddle applied to Sun Pharma:

Buy 940 CE + PE = 19 + 9 = 28 Points ( Yesterday near Day end)

Sell 940 CE + PE = 111 + 1 = 112 Points ( Current Trading Values)

Profit = 112 - 28 = 84 Points

Investment 28 points, Return 84 Points in 1 day ( 3 times)
Plz recheck.

Thanks
Rajesh

It seems call and put prices of sell are interchanged. Otherwise overall performoance is same.:clapping: