TARGET :500 Nifty points per month...!

Hi Lincoln,

Not seen you from many days!
Lion is in the Den .. Not sleeping for sure.

I don't know, I can't stop myself from reading your strategy even in real time I am not practising it as I can't stay in front of computer all day along

Using your strategy.. If I can reduce my profit limit But keep it simple

Is this possible ?

Suppose I do the first job right i.e picking the right proce for straddle.

Hypothetical example:
For Sep 5500 straddle

115+106=221 premium received

Margin Blocked: 42K (Higher side, I know yours is lower)
Brokerage paid: 250 (Higher side)

Now spot price is 5460

Ideal situation, I want to be in , Short below 5500 and Long above 5500 .
Nothing else, I don't want to buy/sell in between future, Only interest is IN eating premium
(May defeat purpose of your strategy But as I don't want to sit all day But I have someone who can watch TV and tell me if position get close to 5500 again tell me to reverse OR I can place the reverse order also as stop trigger)

1) Is it possible
2) Is it as simple as it sounds
3) Since spot price is 5460 already below 5500 then I should short immediate as soon as I take the premium.
4) When can this strategy turn into a loss or no profit at all.

Thanks Lincoln and other experts
Please advise
Kaps:thumb:

Hi Cool KK,
To the best of my understanding......

In the case explained above, There may be three scenarios.
1. Market is going down continuously --- you will be in profit but profit will be stable as NF gain will get offset against Put loss. you will have call premium in your pocket which is your profit.
2. Market is going up : I am assuming NF short at 5450. If you do not switch your position after 5500 then this trade will move into loss ~5580. & Loss will be increasing continuously.
3. Market is volatile & moving in between 5450 & 5550: If this is happening frequently & you are changing your positions but if your stoploss is hitting frequently then this position will be in profit till you exhaust with all your time value. Assuming 5450as spot price you have time value of 171(221+5450spot price-5500(strike price))
You will have to monitor 5500 level continuously to to ensure your shot exit & long entry is exactly at 5500( or vice versa). In this case loss will be only brokrage from time value. As you will not be monitoring it continuously there is possibility that you may loose some additional points.

Hi Lincoln,

Not seen you from many days!
Lion is in the Den .. Not sleeping for sure.

I don't know, I can't stop myself from reading your strategy even in real time I am not practising it as I can't stay in front of computer all day along

Using your strategy.. If I can reduce my profit limit But keep it simple

Is this possible ?

Suppose I do the first job right i.e picking the right proce for straddle.

Hypothetical example:
For Sep 5500 straddle

115+106=221 premium received

Margin Blocked: 42K (Higher side, I know yours is lower)
Brokerage paid: 250 (Higher side)

Now spot price is 5460

Ideal situation, I want to be in , Short below 5500 and Long above 5500 .
Nothing else, I don't want to buy/sell in between future, Only interest is IN eating premium
(May defeat purpose of your strategy But as I don't want to sit all day But I have someone who can watch TV and tell me if position get close to 5500 again tell me to reverse OR I can place the reverse order also as stop trigger)

1) Is it possible
2) Is it as simple as it sounds
3) Since spot price is 5460 already below 5500 then I should short immediate as soon as I take the premium.
4) When can this strategy turn into a loss or no profit at all.

Thanks Lincoln and other experts
Please advise
Kaps:thumb:

in ur example, u are getting 221 points for a 5500 straddle short... expiry next month...there is plenty of time left... the time value on the 221 points is just 221 - (5500- 5460) = 181 points...

Now u do realise that a 3% move is enough to get you on the wrong foot...

This strategy is not meant for you as you are taking a lot of risk for a very little return... assuming u dont get time to man the screen... ofcourse...!

Thanks Lincoln for your time to reply

Hmm.. I was thinking I can use a part of your startegy to eat premimum and just short/long Nifty at my straddle strike point

It doesn't look like a great idea.. Isn'ted ?

Thanks
Kaps

Actually...writing a straddle / strangle can be hedged with nifty... but issue is the non linear movement that we have every day... say u are running a short..and the next day it reverses... then you end up having to decide if you should reverse the trade or hold on ...

for someone who cant manage to give sufficient screen time...ideal strategy is to short straddle / OTM strangle and have a definite cut off point in terms of nifty movement... where you exit the trade...

or u can go for calender spreads...

Hi

I need an advise to hedge my 5500 Call sell @ 27 yesterday So I am in no loss no gain so far But I am looking to hedge it.

Any advise ?

I am more inclined toward hedging with option at this time

But

if future will be better then I am also for it

Also when to exit on your advise after hedging it
I don't want to win this trade But just want to protect it in a better way.

Thanks
Kaps

buy and hold nifty futures of the same qty if 5489 is broken...
till then enjoy the premium....