Captured a good set of November options. Will exit as the day closes. Idea is to not lose money to theta while capturing any move in any direction.
IV is low today - fair chance a straddle may not work - either way I will exit by EOD.
IV is low today - fair chance a straddle may not work - either way I will exit by EOD.
Comment:
Closed trade in profit.
Comment:
Lesson: Hold the options strategy till EOD
Realized profit : (273-272)*225=INR 225
BnH profit (if I stuck to the target I had) : (288-272)*225=INR 3600
Profit is profit - I need to work on my patience.
Realized profit : (273-272)*225=INR 225
BnH profit (if I stuck to the target I had) : (288-272)*225=INR 3600
Profit is profit - I need to work on my patience.
Comment:
Hitesh Bhatia shared a link.
Just now
I have been testing this strategy exclusively for NIFTY50 index. Applicable to anything. Very basic - read carefully. Tag others also.
Long Straddle (Intraday):
Assumption: Price is 10475 (as an example)
Premise:
1. The price will go at least 10 points in the direction of either strike
2. The delta of the approaching option of strike will go higher
Execution:
1. Buy 1 lot of 10450 call one hour after open
2. Buy 1 lot of 10500 put one hour after open
3. Sell both options EOD - 1 hour
Result:
1. Ideally, on any day with volatility in any unpredictable direction, you should have a net profit. The loss is the theta loss intraday, which can be calculated theoretically by theta-theta (i.e. taking the difference of the theta in the prior two days, this is not exact but a good approximation)
2. RR is generally above 5:1.
Example (did this trade today): www.tradingview.com/...IFTY-Intraday-Long…/
1. Price at starting was 10475
2. Bought call option and put option for total premium of 145 + 125 = 270 and per lot that is 270*75 = 20250
3. At end of day, price of nifty is at 10560, the total worth of the options is now 200+85 = 285 and per lot that is = 21375
4. Sell both options at 3pm
5. Profit = 21375-20250 = 1125
6. Profit ROI = 1125/20250*100 = 5.55%
Note:
1. Best results when the current price is in the exact middle of the two strikes i.e. for eg if price is between 10450, 10500, best entry of both options should be at 10475 price.
2. Today was a day of high volatility, in sideways market this can cost a little money
3. Best part - I automated it for zerodha
Just now
I have been testing this strategy exclusively for NIFTY50 index. Applicable to anything. Very basic - read carefully. Tag others also.
Long Straddle (Intraday):
Assumption: Price is 10475 (as an example)
Premise:
1. The price will go at least 10 points in the direction of either strike
2. The delta of the approaching option of strike will go higher
Execution:
1. Buy 1 lot of 10450 call one hour after open
2. Buy 1 lot of 10500 put one hour after open
3. Sell both options EOD - 1 hour
Result:
1. Ideally, on any day with volatility in any unpredictable direction, you should have a net profit. The loss is the theta loss intraday, which can be calculated theoretically by theta-theta (i.e. taking the difference of the theta in the prior two days, this is not exact but a good approximation)
2. RR is generally above 5:1.
Example (did this trade today): www.tradingview.com/...IFTY-Intraday-Long…/
1. Price at starting was 10475
2. Bought call option and put option for total premium of 145 + 125 = 270 and per lot that is 270*75 = 20250
3. At end of day, price of nifty is at 10560, the total worth of the options is now 200+85 = 285 and per lot that is = 21375
4. Sell both options at 3pm
5. Profit = 21375-20250 = 1125
6. Profit ROI = 1125/20250*100 = 5.55%
Note:
1. Best results when the current price is in the exact middle of the two strikes i.e. for eg if price is between 10450, 10500, best entry of both options should be at 10475 price.
2. Today was a day of high volatility, in sideways market this can cost a little money
3. Best part - I automated it for zerodha