Hillary’s win was already appreciated by the market and you can see I was biased towards Trump. Well, yes. I like Trump more than Clinton and so does everyone I know.
On the doomsday I shorted the VIX options till the results of Florida was estimated by Wall Street Journal that Trump is going to win by 82% chance. I reversed my trades.
The following Indian trading day, I shorted my entire portfolio with more leverage as I was fearing market will run for a free fall and bought it back by end of the day. It turned out as a charm but Zerodha was having glitch like shit whole day long!
Tip: Use Aftermarket orders.
After I wrote the previous article as mentioned there I started shorting Bajaj Finserv on 7th when the parabolic SAR confirmed the flip on the previous day. I got anxious as one of my portfolio manager was having this stock accumulated but well, I didn’t interfere them thinking they might have some plans.
But I was wrong! They didn’t close the position and I am serving a minus sign on my balance with them. But overall, I gained a huge sum here 🙂 The demonetization news made additional boosted gains.
Gaining 40 times with NIFTY options
I shorted Nifty Options after the next day to hedge against the fall of my portfolio holding while I wrote that answer and till now made around 2 Lakhs!! It was 6th November. Thanks demonetization to provide additional acceleration. Here are the details:
My strike price was 256. I sold 900 call options and reversed the position by buying 1800 call options on 15th @6.50. So I have closed my previous 900 options positions and open a new buy options.
Profit: (256 – 6.50) * 900 = 249.5 * 900 = 2,24,550 INR
Yeah I made a loss on the second trade. Considering the option expires at 0 I am at loss of 6.50 * 900 = 5,580 INR
Net Profit: 2,24,550 INR – 5,580 INR = 2,18,700 INR
The reason I bought it has made a loss trade is Max Pain Theory and I believed that NIFTY will end up near 8200 at the time of expiry but it makes a steep movement which along with the time decay factor ended the option worthless.