Option Buy Recomendations

[ghosh_ak34]

Dear Friends,

For Nifty Future traders who would like to trade as per trend check strategy posted in 1st post of the thread, Nifty levels for tomorrow are as under:

Resistence at 5054
Support at 4965

If you go short 1 lot then, buy 1 lot at money or near money call and if you go long 1 lot then, buy 1 lot at money or near money put to hedge. Reco. to trade as per trend strategy posted in 1st post of this thread.

Regards

 

[sprintravi75]

Dear Friends,

For Nifty Future traders who would like to trade as per trend check strategy posted in 1st post of the thread, Nifty levels for tomorrow are as under:

Resistence at 5054
Support at 4965

If you go short 1 lot then, buy 1 lot at money or near money call and if you go long 1 lot then, buy 1 lot at money or near money put to hedge. Reco. to trade as per trend strategy posted in 1st post of this thread.

Regards

dear all

i came across this site. i am sharing this. it may be useful for members.
http://niftyoptiontrading.blogspot.com/

regards

 

[aditya14]

Hi,

I am new to options.
I bought NIFTY 5100 Call @ 45(10 lots) and NIFTY 5200 Call @ 13(9 lots) expiring this month end (Oct 29th, 2009).
I bought both the calls on 21st Oct, 2009

Do you think its advisable to hold until expiry or sell it off with current loss?

Really appreciate your suggestion

-Sunny

SELL IT OFF BOY.This is same mistake i did when i started out and lost more than you.I have actually done stupider thing and held on till expiry hoping that it will go to my levels.

Now if you want to hold then tomorrow is critical day for you if market bounces for your 5100 call.And 5200 you shud book loss as soon as possible.

 

[ghosh_ak34]

Dear Friends,

For Nifty Future traders who would like to trade as per trend check strategy posted in 1st post of the thread, Nifty levels for tomorrow are as under:

Resistence at 5022
Support at 4919

If you go short 1 lot then, buy 1 lot at money or near money call and if you go long 1 lot then, buy 1 lot at money or near money put to hedge. Reco. to trade as per trend strategy posted in 1st post of this thread.

Regards

 

[ppmatkari]

Dear Sunny,

Current months expiry is next week so Oct options will loose its premium and so 5100 calls as there is less chances of Nifty to cross 5100 level strongly by monthend.

Time decay is a crucial component traders consider when deciding when/where to buy or sell options. Time decay (Extrinsic Value ) is represented by Theta. Lets not go into these Greeks. An options time to maturity (or time to expiration) has a huge impact on the price of the option. That is, as the option moves closer to expiry (i.e. running out of time) its chances of becoming more profitable decrease with every passing day. As you can probably imagine, predicting an approximate stock price becomes easier every day. For example, you will have a much greater chance of predicting tomorrows closing price of Reliance Industries or Bharti or stock that you closely track than you will of predicting next Fridays closing price.

Because of this, the Time Value of an option decreases exponentially as the maturity date approaches - especially as the time to maturity passes near last Thrusday of current month. For OTM options this is key, as the entire option is made up of Extrinsic Value.

We buy an OTM only when we believe that there is very strong chance of OTM to become in-money.

A vechile runs faster when running on a platform having less friction coefficient and when friction increases ie. running on sand for example, its speed decreases. You can compare this friction with time decay for options.

This friction is max. near expiry so its reco. not to buy an option after 20th of the current month.

Will suggest you to use a option calculator to calculate your risks-reward ratio before taking a decision for trade and be a regular visitor to nseindia->option-chain segment to see whats happening in options space.

Download options data for Nifty or the stock of your choice for the last 3 month of 3-4 strike prices. (One AT money or near money,one OTM, one ITM)
to see and understand the movement. Also keep the corresponding chart for the month side by side to understand its movement vis `a vis corresponding options strike price movement. You can also add/modify some indicators to see its effectiveness etc.

Being a self learner I followed the above myself and have found it useful.

Hope above helps.

Regards

Sorry Sir......forgot you in your own thread....Please pardon. Now corrected my post.

 

[ghosh_ak34]

Dear Friends,

For Nifty Future traders who would like to trade as per trend check strategy posted in 1st post of the thread, Nifty levels for tomorrow are as under:

Resistence at 4910
Support at 4763

If you go short 1 lot then, buy 1 lot at money or near money call and if you go long 1 lot then, buy 1 lot at money or near money put to hedge. Reco. to trade as per trend strategy posted in 1st post of this thread.

Regards

 

[msunny31]

Hi Ghosh Sir,

Need ur suggestion on the below plan

2 lots NIFTY 5100 Call @ 49 rupees premium and 1 lot of NIFTY 4600 PUT @ 58 rupees premium, expiring Nov 26th, 2009

Kindly suggest.

 

[schamarthy]

Thanks for the insights

 

[ghosh_ak34]

Hi Ghosh Sir,

Need ur suggestion on the below plan

2 lots NIFTY 5100 Call @ 49 rupees premium and 1 lot of NIFTY 4600 PUT @ 58 rupees premium, expiring Nov 26th, 2009

Kindly suggest.

Dear msunny31,

Correct position you have taken, keep a hold on to it with a suitable SL. If Nifty drifts below 4760 levels move put write strike price to 4500 strike price.

Regards

 

[terminator_123]

Hi Ghosh,
How does this position look. Do you feel it would need a little hedging ? perhaps replace the nov26CE5100 with nov26CE5000 ?
(Though I feel its a pretty defensive one and comfortable with the margin etc, I have a bad feeling that vix might keep rising in the coming days)
Sold:
6 lots [email protected],
6 lots nov26CE5200@31
1 lot of nov26CE5100@44
with SL=3000

Thanks,
pavan