Rajandran R Founder of Marketcalls and Co-Founder Algomojo. Full-Time Derivative Trader. Expert in Designing Trading Systems (Amibroker, Ninjatrader, Metatrader, Python, Pinescript). Trading the markets since 2006. Mentoring Traders on Trading System Designing, Market Profile, Orderflow and Trade Automation.

Options Strategy for the Month of October – Bull Call Spread/Long Call

36 sec read


 
Nifty is likely to cross 6300 by expiry due to following reasons.

  1. Sustained buying by FIIs – incoming smart money
  2. Sustained selling by DIIs  – outgoing dumb money
  3. High implied volatility in far month series as most traders are still holding short.
  4. High premium in nifty futures contract as most traders continue to take short.
  5. Possible good Q3 results.
  6. Put call ratio at 1.3 indicating strong support at 6000 zone.

Given all the above facts, one can safely use following strategy

Advanced trader

Long nifty 6100 call @125

Short nifty 6300 call @36.6

Max profit at 6300 is 110.45(Rs.5522), max loss at 6100 is 89.55(4477.5)

Or

Long nifty 6100 put @71.5

Short nifty 6300 put @180.95

Max profit at 6300 is 106.55 (Rs.5327), max loss at 6100 is 93.45(4672.)

Retail trader:

Long nifty 6200 call @71(moderate risk). Max profit: Infinity

Long nifty 6300 call @35.60(low risk) Max profit: Infinity

Please choose trades based on your risk appetite. There is risk involved in this kind of trades as detailed above. This trade is for educational purpose. Hold all positions till expiry.

Narendar Rathod, options strategist, www.assuredgain.com

Rajandran R Founder of Marketcalls and Co-Founder Algomojo. Full-Time Derivative Trader. Expert in Designing Trading Systems (Amibroker, Ninjatrader, Metatrader, Python, Pinescript). Trading the markets since 2006. Mentoring Traders on Trading System Designing, Market Profile, Orderflow and Trade Automation.

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12 Replies to “Options Strategy for the Month of October – Bull…”

  1. Sir,

    If I purchase Nifty 6300 call-Oct @ 22 /- whether my loss , if at all is limited to 50X 22 =Rs.1250/- only or unlimited value, because in the margin calculator of the broakerage , it has been mentioned as unlimited loss/margin required. I have this doubt. Kindly clarify. Further how to arrive @ what point it will losse its value and become zero/or no buyers are there

    Furhter , the funds required is only to that much amount Rs.1250/- or Rs.nifty future value amount of Rs,28,000/-

    Thanks

  2. Dear bala, you loss in buying call is limited only to the premium you pay, i.e 22*50 per lot. Total margin for trading this call is only 1110. so your maximum loss is 1110. on expiry nifty should be above 6322 to make profit, but you can book profit now @63 or hold for more profit.

    Narendar

  3. sir, your strategy is rocking, i bought 3 lots of 6300 call on 12th at 23, booked profit in two calls today at 70, am very thankful for providing such wonderful calls.

  4. Sir,

    Thanks to all and to Rajendran Ji.

    In the leave your response , my name and email id is visible after posting the comment. Chances of some body posting in my mail id /name is there . How to remove this. To day also I opened to see any response is there for my posting and seen the mail id and name is appeared in the leave your response .
    By the by if once again comes down and if so @ what level one can purchase for holding

    I feel trading in call is more benificial than nifty since how much loss if at all is quantified

    For loss limiting buying call and selling put is appropriate.

    Any guidance about call /put

    Onnce again thanks to Rajendran

    Thanks

  5. GM sir,
    i m watching ur site everyday. ur charts is simply great.
    thank u sir, for giving great support.
    thank u sir.
    have nice day

    1. @Manaf

      Thats a old call. Infact it had yield hansome returns. Also Naren already recommended to close
      and exit this strategy near 6300 levels. The strategy has been already closed long time back
      this october.

  6. The Oct 2010 expiry was at 5987. Far from 6300.

    Another expert/guru failed.

    Put the effort to start reading the markets correctly rather then trying to become expert/guru/selling services.

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