I was trading regularly in BankNifty naked options intraday for last couple of months. Whereas i made some really good profits, but sooner or later i realize there is too much risk on it, and almost deciding to stop trading in BNF options. Why?
Too much volatile, high beta.
The average true range on a BankNifty option is around 15-20 points, for future it is 30+.
So depending on your account size, lets say you have 1 lakhs account. 2% is the max. loss per trade/day, stands out to 2000/-. So, if you put a stoploss of 16-17 points outside ATR, at any point of time, you should be ready to have a minimum of 2k+ loss on every single bankNifty options trade for a decent lot size of 200.
(I have created this thread from options perspective, since thats what i traded on, but it equally applies to futures)
Views welcome
Too much volatile, high beta.
The average true range on a BankNifty option is around 15-20 points, for future it is 30+.
So depending on your account size, lets say you have 1 lakhs account. 2% is the max. loss per trade/day, stands out to 2000/-. So, if you put a stoploss of 16-17 points outside ATR, at any point of time, you should be ready to have a minimum of 2k+ loss on every single bankNifty options trade for a decent lot size of 200.
(I have created this thread from options perspective, since thats what i traded on, but it equally applies to futures)
Views welcome
Last edited: