Trading for Living -- Successfully Completed one year as Full Time Trader
- Thread starter amrutham
- Start date
Mazher,
In fact ,my whole position would have been more profitable, if BN moved towards 24000 instead of current 25000.
Once BN breaks 24500 in intraday, I would have closed half of 24000 PE and would have shorted may be 24800 CE.
If it was a big gap down next day and BN goes below 24000, then no other option other than take the loss from 24000 PE and may be short APR monthly contract of 23000 PE. In this case I would have made a profit of 60K on my long 24500 PE and short 24400 PE positions.
Hence the adjustments you have to make are not always constant. It depends on the number of days remaining to expiry.
In fact ,my whole position would have been more profitable, if BN moved towards 24000 instead of current 25000.
Once BN breaks 24500 in intraday, I would have closed half of 24000 PE and would have shorted may be 24800 CE.
If it was a big gap down next day and BN goes below 24000, then no other option other than take the loss from 24000 PE and may be short APR monthly contract of 23000 PE. In this case I would have made a profit of 60K on my long 24500 PE and short 24400 PE positions.
Hence the adjustments you have to make are not always constant. It depends on the number of days remaining to expiry.
New BN trade taken for tomorrows expiry. CMP BN: 25070
Buy BN 25000 PE 600 Qty @ 98
Sell BN 24900 PE 1200 Qty @ 62
Buy BN 24800 PE 600v Qty @ 39
Total Debit = 98+39 - 124 = 13 *600 = 7.8K
Max Loss = 7.8 K if BN < 24800 or > 25000 by expiry
Max Profit = 60 K @24900
Will close the position , if it goes in to profit of 10-15k at any time till expiry. Otherwise let it expire.
Buy BN 25000 PE 600 Qty @ 98
Sell BN 24900 PE 1200 Qty @ 62
Buy BN 24800 PE 600v Qty @ 39
Total Debit = 98+39 - 124 = 13 *600 = 7.8K
Max Loss = 7.8 K if BN < 24800 or > 25000 by expiry
Max Profit = 60 K @24900
Will close the position , if it goes in to profit of 10-15k at any time till expiry. Otherwise let it expire.
With the short 25200CE opened, it was very clear as Delta -ve trade given the opening price action.
By adding the 24800PE shorts, are you trying to gain from theta going forward till EoD and more importantly gain from the IV's collapsing on both positions or is it just a hedge trade bcos currently you are delta neutral and short on the above two greeks?
Edit: I've tried that few times, when sudden mkt moves are opp. to expected nature, huge spikes in IV occur that you can short and benefit from.
but I prefer on very large IVs, when its +30 on BN for eg.
By adding the 24800PE shorts, are you trying to gain from theta going forward till EoD and more importantly gain from the IV's collapsing on both positions or is it just a hedge trade bcos currently you are delta neutral and short on the above two greeks?
Edit: I've tried that few times, when sudden mkt moves are opp. to expected nature, huge spikes in IV occur that you can short and benefit from.
but I prefer on very large IVs, when its +30 on BN for eg.
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