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If today Nifty moves further 2% from here, will it be UP or DOWN?


  • Total voters
    11
  • Poll closed .

jamit_05

Well-Known Member
#21
With this directionless approach, most of the times loss would mean that you have to know when you are defeated. Then you will get a chance to get out break even. If one is not skilled enough for that, then there is the stop loss.

Meaning, consider the selling of options that we recently only discussed. If there is indeed a back to back rally, then we are pretty much beat. So, when the market falls slow after that (and before the protective stop is hit) one has a chance to bail out.

Well, this is the gist. Still in developmental stage. This will significantly improve RR if proves applicable.
 

jamit_05

Well-Known Member
#22
Just entered new position.

June Month 5000CE bought at 101.55
4800PE at 85.25

Cost: 186.80

target: 20% gain. Or a massive move... SL 50% of the value...

Nice.... this trade too turned out to be nice.

Cost 186.80 + 2 expense = 188.80
Current value = 142+70 = 212
Gain = 23.20

that is over 12%.... I was sure of getting out around 4800 but I could not be at the terminal. Anyhow, will get out tomorrow morning.
 

jamit_05

Well-Known Member
#23
Two longs panned out okay. Each giving near 15% profit. This level may not improve much. Hence, I think I will bring down the stop loss to 30%. To maintain 2:1 RR;

Now, time for shorts on Friday towards the End.
 

jamit_05

Well-Known Member
#24
Since I trade intraday my profits largely depend on market making strong directional moves. Therefore, if I have a method that gives profit when market is directionless, then the two could complement each other well. From that perspective, the shorting option pair would be more suitable.
 
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jamit_05

Well-Known Member
#25
Cost of 100 point OTM at Nifty 4900

5000 CE 96.45
4800 PE 99.55

total of Rs.200;

We had 210 early this week then a low of 182;
So 200 is pretty high four days later.

However, Friday could throw a strong down move. Lets wait for Friday close. Then will enter a short position.

Best, would be if Friday goes down strongly, near 4700 levels and the option pair cost goes 205 plus... then we will short it.
 
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jamit_05

Well-Known Member
#26
Cost of 100 point OTM pair at Nifty 4900 is Rs.197;

Pretty high. Considering the fact that it was in 180s a few days ago. One could safely say that around 200 it is a very good short.
 
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jamit_05

Well-Known Member
#27
Having studied the weekly nifty charts one things has become evident that Shorting options neutral spreads is not profitable.

I will stick with buying OTM option pairs. Have already taken two such positions, both profitable. This week onwards, will enforce more discipline in the method.

Rules:

1. On Monday morning at 11 a.m. buy the nearest 100 OTM options pairs.
2. Hold till a 10% profit realizes. Else exit at Friday before closing or at 10% loss, whichever of the three comes first. Restart on Monday.
3. Increase Position size to the tune of 10% each week.

So, one trade each week. One entry and one exit... simple stuff really. Along the way, hope I am able to add any significant edge.
 
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#28
Having studied the weekly nifty charts one things has become evident that Shorting options neutral spreads is not profitable.

I will stick with buying OTM option pairs. Have already taken two such positions, both profitable. This week onwards, will enforce more discipline in the method.

Rules:

1. On Monday morning at 11 a.m. buy the nearest 100 OTM options pairs.
2. Hold till a 10% profit realizes. Else exit at Friday before closing or at 10% loss, whichever of the three comes first. Restart on Monday.
3. Increase Position size to the tune of 10% each week.

So, one trade each week. One entry and one exit... simple stuff really. Along the way, hope I am able to add any significant edge.
My experience shows that ....

Buying is good if bought BEOFRE last two weeks to expiry
Selling is good if SOLD in the last two weeks to expiry
No selling/buying of series in Expiry week, instead go for next month series

Means: Buy June Expiry on Monday (expiry weeks pending- 5...more than 2 weeks).
 

jamit_05

Well-Known Member
#29
There are some other Edges that could be included.

1. Cost retracement. Just to make sure that we are not entering when option prices are heated up. In due course, we will have a decent reading for the level of retracement for each week. For ex. Last week showed a high of 212 low of 185; Therefore this week, as soon as i get a 170 I am willing to enter. After this cooling off, we expect a 100 point move. This nullifies the earlier intention of blindly entering on Monday morning, since it covers the idea of cost retracement better.

2. After, entry a suitable intraday moving average could be used to determine intraday end of trend. This will prove crucial to maximize profits esp when a leg becomes ITM.
 

jamit_05

Well-Known Member
#30
Cost of 4800 PE + 5000 CE is

73+103 = 176

That is pretty good...

Targetting a total of 170.... no reason... just bargaining.
 
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