iCharts Discussions

[hansraj456]

Hi
Profit calculation of 1st hedging position of Jan.2010 :
Position taken on 05 January 2010
Sold Options of Feb.2010 Series and Hedging to be done by Nifty Future of January 2010 Series.

Premium of 5100 Call = 287
Premium of 5400 Put = 221
Total Premium = 508
Nifty Future Points gained = 0
Points gain at the time of selling both options = 523

Net gain in points 523 - 508 + 0 = 15 Points

Target : 200 Points by 21-25 January 2010.


Thanks

[sabikhanuja]

Hello Hans,
From last few days, i m reading ur post and found interesting to get gain of 400 points each month... i have one query......that ..if we make our position at 5000 as u did last trade..............long at 5000 and short call of 4800 and put of 5100 ...if nifty comes back to 5000 after hitting 5050 ...then one should exit NFuture..(Ques-->)...then do we have to exit options also or should wait to go long (above 5000) or short (below 4950).. i hope u understand.............

After hitting 5000 again should we exit from sell options also or wait to take long /short in NF . one thing more...we have to long/short for same month or next month in NF ?. I m tracking this month by paper trade .long from 5200 by selling 5100call(feb series) and 5300 put(feb series)..(any views/advise)....i hope u reply soon..........thanks in advance

[hansraj456]

Hi
Profit calculation of 1st hedging position of Jan.2010 :
Position taken on 05 January 2010
Sold Options of Feb.2010 Series and Hedging to be done by Nifty Future of January 2010 Series.

Premium of 5100 Call = 289
Premium of 5400 Put = 225
Total Premium = 514

Nifty Future Points gained = 0
Points gain at the time of selling both options = 523

Net gain in points 523 - 508 + 0 = 09 Points

Target : 200 Points by 21-25 January 2010.


Thanks

[greatshiva]

I have come across this strategy earlier here :

http://www.articlesbase.com/day-trading-articles/how-to-earn-70-return-on-investment-by-trading-in-nifty-future-and-options-1568313.html

But anyhow , it is nice to see it implemented succesfully

Carryon , good job

[hansraj456]

Hi sabikhanuja

You have to hold short options atleast for 2 weeks keep on hedging with NF of near month series. The trades u are tracking on paper does not match my strategy because difference between both the options sold is generally 300 points. My advice to you is please read the entire thread from last page till date and try to fully understand the strategy. All the answers to your question are given in detail there. Better to track the trades we have actually taken. I have uploaded file of my trades for last 4 months and from December, I am giving my hedging calls at this forum.

Thanks

[sabikhanuja]

Hai Hans,
As i have read ur previous posts.....i think its like this.... we have to short sell call and put with the difference between 300 points......like at 5200 NF we have to short sell 5000 call and 5300 put....am i right?............but the again the question arise.... at 5200 we should short 5000 or 5100 call with 5300 or 5400 put
mean to say .....put is for 100 points diff or 200 points..........and call is
for 200 points or 100 points... from 5200 .......which is best at 5200
for both positions long and short ?
First Option::
NF 5200
call 5000
put 5300

second option::
NF 5200
call 5100
put 5400
which is right ? ...............which is good for long and short ?
sorry to ask again these type of question but i want to clarify my doubt
hope u dont mind thanks

[hansraj456]

Hai sabikhanuja

Partly ur right. Let's take your example. If you sell 5000 call and 5300 put, Nifty should not be at 5200 but it should be around 5150 (10-25 points up or down, as the prices keep moving during the trading hours). Means difference of put and call strike price from the current nifty price should be around 150 points, in other words the nifty price should be between two strike prices of put and call. In such circumstance, we get premium of both the options above 200 points and difference of premium between sold put and call option is generally not more than 100 points.

Now how to decide where to go short or long in Nifty future. As per above example, if nifty is between 5150 and 5200, Go long at 5200 and go short at 5150. If nifty is between 5100 and 5150, go long at 5150 and go short at 5100. The levels for going short or long are not technical levels but are psychological levels.

Hope now things are clear?

Thanks for asking.

[kripalsinh8888]

To , Greatshiva .......

Dear, the strategy through which u have come across is totally different than this one discovered by mr. Hansraj ..........

bcoz in tht strategy.........u posses some risk when u go for a trade n u also book loss @ sumtimes.........as well as the main drawback of tht strategy is tht u r deciding the trend of Nifty fut. before entering into it..........whereas over here u r not deciding the trend of Nifty fut. ...........u r letting it go wherever it wants to go...........u r not letting nifty fut. decide ur fate...........

these r the main drawback I have found in tht system..........

This piece of Information is just to acknowledge u abt this strategy..........so plz dont take it as an offence >>>>>>>..

With regardz ,
Kripalsinh

[hansraj456]

Hi All

Few people must have lost 5-10 points for sudden Nifty Short triggers. I also lost 5 points. Remember these lost points and next time, when nifty comes to either long or short levels i.e. 5300 or 5250, go with 2 lots and recover the points. Suppose, again such sudden spike comes, again note down the lost points and then next time go with 2 lots (donot increase No. of lots, but keep on adding No. of points). Nifty cannot be stuck betwen 5250 and 5300, it has to move either way, so lost points will surely be recovered, only discipline is required.

Thanks

[hansraj456]

Hi
Profit calculation of 1st hedging position of Jan.2010 :
Position taken on 05 January 2010
Sold Options of Feb.2010 Series and Hedging to be done by Nifty Future of January 2010 Series.

Premium of 5100 Call = 274
Premium of 5400 Put = 222
Total Premium = 496

Nifty Future Points gained = 0
Points gain at the time of selling both options = 523

Net gain in points 523 - 496 + 0 = 27 Points

Target : 200 Points by 21-25 January 2010.


Thanks

[deepika kwatra]

sir wat if 2mrw nifty opens up wid a gap of 20 pts on dwnside ..say its 5240...so shud we go short in nifty den n dere only or shud we wait for it to sustain dat level ....n how many lots ds tym ???

thanks n regards
deepika

[greatshiva]

Hi Kripal,

Thanks for your reply

I dont think you need to know the trend for using the strategy in that link. The strategy is same in this all conditions....

Coming to losses , that strategy has results for period written during that time. But now , it may give good results...

[sabikhanuja]

Hai Hans,
Thanks for reply ,,,, and clarify the doubts.............the trade which i took ......as a paper trade today i m getting 45 points..........by luck .......i will track ur stratg. for next 1/2 months and then like to enter.....i used to trade in nifty options on 15th of every month...........strat was to buy Nifty call and put of next month with the diff of 250 to 300 points..........drawback of startg. was when mkt range bound premium of both call and put decrease.......so there are chances of loss.....but with stratg. chances of loss are less.........thanks...for ur support.............

[hansraj456]

Hi
Profit calculation of 1st hedging position of Jan.2010 :
Position taken on 05 January 2010
Sold Options of Feb.2010 Series and Hedging to be done by Nifty Future of January 2010 Series.

Premium of 5100 Call = 260
Premium of 5400 Put = 240
Total Premium = 500

Nifty Future Points gained = 0
Points gain at the time of selling both options = 523

Net gain in points 523 - 500 + 0 = 27 Points

Target : 200 Points by 21-25 January 2010.


Thanks

[hansraj456]

Hi

I indicated few days back to give hedging strategy call for small investors under MiniNifty. But due to very thin volume, the call has not yet been found to be suitable. Therefore, no call will be given now.

Thanks