Please read my previous posts on this with an open, calm, clear mind, I have tried my best, explaining all that I do. BTW you cannot put stop-loss on synthetic option strategies - that will be a live invitation for a disaster because Option prices can move drastically on any direction on slightest of Volatility upbeat - there is no way to measure or forecast it beforehand. So, as a protection on synthetic option strategies, "adjustments" are made which I have already explained in details. Touch wood, I am using this options strategy for past 21 months - not a single loss and 68% up on total capital.
Are you kidding??? Check Oct'18 (not even six months back) - it fell about 25% in 2 days and recovered most of it by month's end - that makes this stock very volatile. We want to target down-trending stocks but not the volatile ones. I have also shared a list of shares which I trade cyclically and it works like a charm.
Greed will always make your position suffer in the long run. There is no room for emotion in this. Only calm, composed well thought pre-planned, clean execution will help your capital grow - nothing else! Idea is to enjoy time decay as expiry approaches by selling strong resistances. In case of IOC, you have violated many rules of this technique.
As Option writers we cannot push the far OTM every time a stock makes a low. If we do that, then the market will easily trap us - we do not want to get trapped, so, we need to always account the fact that the Stock can always bounce back to claim the previous resistance at any given point of time. The motive to increase profitability can successfully be achieved when stock price falls significantly, i.e. in terms of Price action makes a new Swing Lower High.
If this happens:
View attachment 33538
Then please do not do these immediately:
View attachment 33542 or View attachment 33543
because stock has just corrected and trying to find a support, we cannot know beforehand that where a support will be bought and where the next resistance will be. Primarily, our goal is to avoid this:
View attachment 33545
Do you get my point? Had you stayed on the previous far OTM instead of moving downward immediately, you could have now easily moved upward to the very next strike or where the next highest OTM Call OI exists (with less multiple of lots). Like this:
View attachment 33547
OR
View attachment 33548
Monitoring a position in order to safeguard or enhance is one type of mindset but doing "kirkiri" everyday out of emotional euphoria or despair is unacceptable. In case of IOC, you have not mentioned the dates on which you have made the adjustments so as to see what compelled (in terms of price action and moving averages) to deviate from the rules (BTW are you maintaining a spreadsheet registering all your trade dates, net credit/debit, etc...????). My assumption on your IOC mess is that in the desire to increase profits, you dug a pit for this position. You need to have a strong rationale behind taking or adjusting a position.
Also never adjust the initially taken Just ITM / Just OTM Call option pair - it is the heart line which will protect your position in all circumstances.
Hope this helps !!!
Are you kidding??? Check Oct'18 (not even six months back) - it fell about 25% in 2 days and recovered most of it by month's end - that makes this stock very volatile. We want to target down-trending stocks but not the volatile ones. I have also shared a list of shares which I trade cyclically and it works like a charm.
Greed will always make your position suffer in the long run. There is no room for emotion in this. Only calm, composed well thought pre-planned, clean execution will help your capital grow - nothing else! Idea is to enjoy time decay as expiry approaches by selling strong resistances. In case of IOC, you have violated many rules of this technique.
As Option writers we cannot push the far OTM every time a stock makes a low. If we do that, then the market will easily trap us - we do not want to get trapped, so, we need to always account the fact that the Stock can always bounce back to claim the previous resistance at any given point of time. The motive to increase profitability can successfully be achieved when stock price falls significantly, i.e. in terms of Price action makes a new Swing Lower High.
If this happens:
View attachment 33538
Then please do not do these immediately:
View attachment 33542 or View attachment 33543
because stock has just corrected and trying to find a support, we cannot know beforehand that where a support will be bought and where the next resistance will be. Primarily, our goal is to avoid this:
View attachment 33545
Do you get my point? Had you stayed on the previous far OTM instead of moving downward immediately, you could have now easily moved upward to the very next strike or where the next highest OTM Call OI exists (with less multiple of lots). Like this:
View attachment 33547
OR
View attachment 33548
Monitoring a position in order to safeguard or enhance is one type of mindset but doing "kirkiri" everyday out of emotional euphoria or despair is unacceptable. In case of IOC, you have not mentioned the dates on which you have made the adjustments so as to see what compelled (in terms of price action and moving averages) to deviate from the rules (BTW are you maintaining a spreadsheet registering all your trade dates, net credit/debit, etc...????). My assumption on your IOC mess is that in the desire to increase profits, you dug a pit for this position. You need to have a strong rationale behind taking or adjusting a position.
Also never adjust the initially taken Just ITM / Just OTM Call option pair - it is the heart line which will protect your position in all circumstances.
Hope this helps !!!
1. just saw the last quarter and can see i didn't count the downfall % , just upward movement
2. I opened this trades on last Thursday.
So should have gone for next expiry. But I assume that could have ended in same .. I will analyse that.
3. The rationale behind this was - the range bound nature since last 2 months. With the support at 135 and resistance at 120.
4. The adjustment started on Friday itself as the stock moved around 7 percent on that single day. Still not sure where the hell was any news.
5. Plus trade execution mistake which left the whole after the above trade on Friday. I have not shown that in the digram as was trying to find the rules across.
6. IOC massive movements I ignored as I wanted to do get something quick with one week to expiry . Greed
I admit this mess happened as I selected a completely wrong stock and many mistakes from my end .. but ioc is on bull run since lastI4-5 sessions and not a single down day .have you faced anything like 4 adjustments in 5 days ?
Thanks for the details again and yes I do manage excel with price trades credit debit.
Now back to drawing board and I am missing the preparation stuff.
I traded infy and TATAMOTORS before this
So all in all I have to improve my stock selection massively.
.