Options Basics

[AW10]

Buy Call Option:

Let us assume for an example that trend is bullish

Present value of nifty----5282 as on 26/03
assumption----nifty would move to 5400
expiry date----29/04
Premium----54.55

So I pay 54.55 and buy 1 nifty call option @ strike price 5400 april expiry

Seniors/AW10 help me in the breakeven and different outcomes of this example

I guess I have messed up in my understanding....

tvrssvk , On first glance, I will reject this plan cause it is not at all a trade plan.

Please use following template while planning the trade

Direction -
Construction -
Cost of trade (or net premium)=
Max Risk =
Max Reward =
Break-even point =
----------------------
This part is for addressing the most important components of trade planning - EXITs

Stoploss point - Price =
Stoploss point - Time =

Profit taking - Direction =
Profit taking - Price =

For more details on it, you can visit 3rd post on my thread - "Low risk options..".

I am leaving here for you or others to do the ground work. If one is serious about learning (and I am sure, you are), one will put the effort and complete the homework.

Happy Learning