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Hedging for Unpredictable Events |
rrsekhar
White Belt
Joined: 21 Feb 2010
Posts: 196
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Post: #1  Posted: Wed Sep 21, 2016 2:07 pm Post subject: Hedging for Unpredictable Events |
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Dear all,
I am short on Bank Nifty Futures 2 lots @ 20037 since 16 Sep 16 with SAR @ 20066.
Can anyone suggest how should I hedge my position for the US Fed decision scheduled today?
regards
rrsekhar |
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pkholla
Black Belt
Joined: 04 Nov 2010
Posts: 2890
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| Post: #2 Posted: Wed Sep 21, 2016 2:23 pm Post subject: Short on BNF |
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Shekhar, If it was me ... and BNF trading at 19834 low AND CMP 19854 THEN I would book profits? ... esp as most likely outcome is freeze on US Fed rate and this may be taken as positive news by our trading community?
Cheers, Prakash Holla |
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amit.sin
White Belt
Joined: 23 Nov 2011
Posts: 28
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| Post: #3 Posted: Wed Sep 21, 2016 2:33 pm Post subject: Re: Short on BNF |
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In case of events, better to book both lots. You can always enter the market.
Still if you want to carry, its better to book 1 lot and hedge the other lot with next month Future long
| pkholla wrote: | Shekhar, If it was me ... and BNF trading at 19834 low AND CMP 19854 THEN I would book profits? ... esp as most likely outcome is freeze on US Fed rate and this may be taken as positive news by our trading community?
Cheers, Prakash Holla |
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rrsekhar
White Belt
Joined: 21 Feb 2010
Posts: 196
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| Post: #4 Posted: Wed Sep 21, 2016 3:33 pm Post subject: |
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Thanks a lot Prakash and Amit.
I have closed my position.
will reenter tommorow
regards
rrsekhar |
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pkholla
Black Belt
Joined: 04 Nov 2010
Posts: 2890
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| Post: #5 Posted: Thu Sep 22, 2016 10:50 am Post subject: Re: Short on BNF |
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| pkholla wrote: | | Shekhar, If it was me ... and BNF trading at 19834 low AND CMP 19854 THEN I would book profits? ... esp as most likely outcome is freeze on US Fed rate and this may be taken as positive news by our trading community? Cheers, Prakash Holla |
Shekhar: Very wise of you to close the positions in profit. BNF like AxisB, SBIN, ICICI, etc is very volatile. See how the Fed news bounced BNF back to 20335 hi and CMP 20155 at 1049AM? |
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rrsekhar
White Belt
Joined: 21 Feb 2010
Posts: 196
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| Post: #6 Posted: Thu Sep 22, 2016 10:59 am Post subject: Re: Short on BNF |
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[quote=Shekhar: Very wise of you to close the positions in profit. BNF like AxisB, SBIN, ICICI, etc is very volatile. See how the Fed news bounced BNF back to 20335 hi and CMP 20155 at 1049AM?[/quote]
Thanks to you sir for advising me.
regards
rrsekhar |
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onemore_bugga
White Belt
Joined: 06 Aug 2009
Posts: 339
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| Post: #7 Posted: Thu Sep 22, 2016 3:21 pm Post subject: banknifty |
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| what to do in banknifty as for next week expiry? |
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pkholla
Black Belt
Joined: 04 Nov 2010
Posts: 2890
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| Post: #8 Posted: Thu Sep 22, 2016 3:32 pm Post subject: Re: banknifty |
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| onemore_bugga wrote: | | what to do in banknifty as for next week expiry? |
Are you following 'SH/ Alchemist' thread on delta neutral + theta based BNF trading, I think this logical, systematic approach is BEST?
Prakash Holla |
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rrsekhar
White Belt
Joined: 21 Feb 2010
Posts: 196
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| Post: #9 Posted: Thu Sep 22, 2016 4:58 pm Post subject: |
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The put call ratio of Bank Nifty expiry date 29 Sep is 1.318 which indicates bullishness. I guess BNF will expire just below 20500 on 29 Sep.
I am long in BNF @ 20097.. I wanted to go long only @ 20066, but took the trade earlier due to itchy fingers. SAR @ 19997
But I may be wrong
regards
rrsekhar |
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rrsekhar
White Belt
Joined: 21 Feb 2010
Posts: 196
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| Post: #10 Posted: Fri Sep 23, 2016 3:34 pm Post subject: |
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I said I may be wrong and how right I was.
Short @ 19997 SAR @ 20145
regards
rrsekhar |
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rrsekhar
White Belt
Joined: 21 Feb 2010
Posts: 196
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| Post: #11 Posted: Mon Sep 26, 2016 2:07 pm Post subject: |
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I shorted Banknifty @19997 and now in 300 points profit.
SAR is 19872.
Can anyone please suggest how to hedge in order to lock in the profits?
regards
rrsekhar |
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pkholla
Black Belt
Joined: 04 Nov 2010
Posts: 2890
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| Post: #12 Posted: Mon Sep 26, 2016 3:29 pm Post subject: Super hit! |
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Shekhar: Successes not only give confidence but also build up capital so that you are better placed to face the inevitable losses that come? My humble suggestion is look for the bottom and square off your short position= 365 pts profit already?
Then continue studying the position by doing serious paper trading as IF you have held on to the position:
like selling one lot put to offset the short future? The income from selling put will add to your profit and hedge the future against reversal losses?
Please search and DL Michael Catolico's text on hedging options. You can also search for a good text on various option hedging strategies like condor, strangle, etc?
Rgds, Prakash Holla |
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rrsekhar
White Belt
Joined: 21 Feb 2010
Posts: 196
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| Post: #13 Posted: Tue Sep 27, 2016 3:35 pm Post subject: |
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Closed my short positions.
+ 400 points.
For tomorrow long @ 19770 or short at 19740 with SAR @ 19770
regards
rrsekhar |
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rrsekhar
White Belt
Joined: 21 Feb 2010
Posts: 196
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| Post: #14 Posted: Wed Sep 28, 2016 3:36 pm Post subject: |
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shorted as said but reversed to longs at end of the day.
SAR will be low of 15 min candle closing below 19593
regards
rrsekhar |
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rrsekhar
White Belt
Joined: 21 Feb 2010
Posts: 196
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| Post: #15 Posted: Thu Sep 29, 2016 9:27 am Post subject: |
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Booked 50% + 100 points
BNF Oct : SAR 19694
regards |
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