nifty put 2500-PCR

[vkwd7]

I am thankful for the advice given regarding not averaging in options.At least I have gained knowledge.
Incidentally I wish to also know about the put call ratio and how it is used
to predict moves in the market.For example, put call ratio for nifty i.e. PCR (OI)is 1.28 and PCR(VOL.) is 1.1 which to me means puts are more than the calls.Does this mean that market is going to come down as more put players are in the field or there is some thing more
hidden to it.
vkwd7

 

[columbus]

I am thankful for the advice given regarding not averaging in options.At least I have gained knowledge.
Incidentally I wish to also know about the put call ratio and how it is used
to predict moves in the market.For example, put call ratio for nifty i.e. PCR (OI)is 1.28 and PCR(VOL.) is 1.1 which to me means puts are more than the calls.Does this mean that market is going to come down as more put players are in the field or there is some thing more
hidden to it.
vkwd7

As far as AVERAGING is concerned there are 2 schools of thinking.
Some people think it is OK ,some think it is BAD.

Averaging in daytrading/shortterm trading is OK but is not advisable always.
Buying NIFTY at 2600 and then adding at 2606 for average of 2603 is
not great AVERAGING ; it should be away from previous value by
substantial amount by 20/30 points in your favour.

 

[hari123]

I am thankful for the advice given regarding not averaging in options.At least I have gained knowledge.
Incidentally I wish to also know about the put call ratio and how it is used
to predict moves in the market.For example, put call ratio for nifty i.e. PCR (OI)is 1.28 and PCR(VOL.) is 1.1 which to me means puts are more than the calls.Does this mean that market is going to come down as more put players are in the field or there is some thing more
hidden to it.
vkwd7

index options are for hedging by fund managers.so take contrarion view.practicaly market goes up with increase in pcr without risk up to 1.5 and then reversalchances.also market goes down up to .9 levels without much risk and then reversal chances.read pcr in conjuction with vix and then take final view.but practicaly smart money operators fail all theories and it is better to stick to 52 week low values and trade for a small profit.things are in bad shape and Fiis are throwing shares at any price .now is the time wher risk even in blue chips has increased manifold.

 

[Knil]

Averaging in Options Trading depends upon your risk apetite of loosing capital as capital appreciation / depreciation is very fast. Normally, positions should not be held for more than 2 subsequent trading sessions if the trade is not profitable [ book the loss instead of averaging so as to save some capital for entering into next trade as per the market trend ]. Even profitable trade should be squared off at the earliest if the set Target is achieved.