{"id":6457,"date":"2015-10-05T04:18:24","date_gmt":"2015-10-04T22:48:24","guid":{"rendered":"https:\/\/unofficed.com\/theta\/?p=6457"},"modified":"2020-05-13T04:22:37","modified_gmt":"2020-05-12T22:52:37","slug":"what-should-be-the-strategy-for-the-weekly-bank-nifty-expiry-option-of-trading","status":"publish","type":"post","link":"https:\/\/unofficed.com\/theta\/what-should-be-the-strategy-for-the-weekly-bank-nifty-expiry-option-of-trading\/","title":{"rendered":"What should be the strategy for the weekly Bank Nifty expiry option of trading?"},"content":{"rendered":"\n<p>This week I had three different setups <a href=\"https:\/\/unofficed.com\/chat\/\">shared in Slack<\/a>. Let\u2019s elaborate.<\/p>\n\n\n\n<p>Strategy A: This is the strategy I teach in <a href=\"https:\/\/unofficed.com\/theta\/\">Theta<\/a>.<\/p>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"aligncenter\"><img decoding=\"async\" src=\"https:\/\/unofficed.com\/wp-content\/uploads\/2019\/06\/main-qimg-f4f4b475d7abd769b6a9b92734526848.png\" alt=\"Banknifty\" class=\"wp-image-8611\"\/><\/figure><\/div>\n\n\n\n<p><a href=\"https:\/\/in.tradingview.com\/chart\/BANKNIFTY\/sfHZncHu-Theta-Week-1\/\">Source:<\/a> You can see the proper rationale in the chart above<\/p>\n\n\n\n<p>Sell 24000 PE sold at 35.65<br>Sell 26000 CE sold at 19.9<\/p>\n\n\n\n<p>This roughly made 2222 INR on 1.5L capital which is good considering there was no active intervention needed.<\/p>\n\n\n\n<p>Strategy B: This is what I am currently experimenting with. Let&#8217;s tell you how I came up with this.<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>I wanted to have some profit which is troublesome considering SEBI\u2019s rip off on margins.<\/li><li>The market falling pretty badly and I can not exit the options without suffering huge damage which is time-consuming to recover.<\/li><\/ul>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"aligncenter\"><img decoding=\"async\" src=\"https:\/\/unofficed.com\/wp-content\/uploads\/2019\/06\/main-qimg-b4f9c73682488333e218e1891d4b3cba.png\" alt=\"banknifty trades\" class=\"wp-image-8612\"\/><\/figure><\/div>\n\n\n\n<p><a href=\"https:\/\/unofficed.com\/options-calculator\/?save_id=5badabdda4fc8272292914\">Payoff Graph:<\/a> If you do not understand options then you can check this link to visualize that how much profit it will make on which point.<\/p>\n\n\n\n<p>The good part here is you are getting a huge sudden profit when things go wrong in your direction giving you ample time to change it and rebalance.<\/p>\n\n\n\n<p>Today it happened. The market broke down and it hit a huge profit.<\/p>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"aligncenter\"><img decoding=\"async\" src=\"https:\/\/unofficed.com\/wp-content\/uploads\/2019\/06\/main-qimg-41ac7ad7556198e35a40ef78935478df.png\" alt=\"Banknifty intraday trades\" class=\"wp-image-8613\"\/><\/figure><\/div>\n\n\n\n<p>Nearly 16K. You can also see next week\u2019s positions here too.<\/p>\n\n\n\n<p>16K in 150K blow my wigs off. I didn\u2019t expect this. So in a trending market like this, you can always try this.<\/p>\n\n\n\n<blockquote class=\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\"><p>Remember the term trending or rangebound depends on the timeframe. BankNIFTY is rangebound between 24000\u201328000 but BankNIFTY is trending in 28000 to 25000.<\/p><\/blockquote>\n\n\n\n<p>Hence, a range-bound strategy like strangle also works if you know how to and where to apply it.<\/p>\n\n\n\n<p>Strategy C: Active firefighting. In this case, my view keeps changing hour to hour basis based on the chart and I actively monitor an account unless I\u2019m playing PUBG.<\/p>\n\n\n\n<p><a href=\"http:\/\/unofficed.com\/go\/discord\/\">I share the trades live in Discord live<\/a>. But let me share the gist of the thought process that happened this week.<\/p>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"aligncenter\"><img decoding=\"async\" src=\"https:\/\/unofficed.com\/wp-content\/uploads\/2019\/06\/main-qimg-27b7fa3193040b35bc5a2f40507b1669.png\" alt=\"Banknifty intraday trades\" class=\"wp-image-8614\"\/><\/figure><\/div>\n\n\n\n<p>I took same positions told above on 28th September, Friday which I closed on Monday and took this &#8211;<\/p>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"aligncenter\"><img decoding=\"async\" src=\"https:\/\/unofficed.com\/wp-content\/uploads\/2019\/06\/main-qimg-2923423d73dd8f5e03313def1030734b.png\" alt=\"Banknifty intraday trades\" class=\"wp-image-8615\"\/><\/figure><\/div>\n\n\n\n<p>I buy shares with the profit, so I bought the Infibeam with last week&#8217;s profit. Monday, The Market moved up and I attained my target on those options so I booked profit.<\/p>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"aligncenter\"><img decoding=\"async\" src=\"https:\/\/unofficed.com\/wp-content\/uploads\/2019\/06\/main-qimg-c1908278b7d001e38ed94d19ef8b28af.png\" alt=\"banknifty trades\" class=\"wp-image-8616\"\/><\/figure><\/div>\n\n\n\n<p>And took a margin filler trade at 15:15 because I didn\u2019t have any view.<\/p>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"aligncenter\"><img decoding=\"async\" src=\"https:\/\/unofficed.com\/wp-content\/uploads\/2019\/06\/main-qimg-d2b59588ac0330a66f4d6fed5199d24e.png\" alt=\"banknifty trades\" class=\"wp-image-8617\"\/><\/figure><\/div>\n\n\n\n<p>Tuesday was closed.<\/p>\n\n\n\n<p>Wednesday I took 25200 straddles and closed the above trade set.<\/p>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"aligncenter\"><img decoding=\"async\" src=\"https:\/\/unofficed.com\/wp-content\/uploads\/2019\/06\/main-qimg-978f197465d529c977b37014d29d5ebe.png\" alt=\"banknifty trades\" class=\"wp-image-8618\"\/><\/figure><\/div>\n\n\n\n<p>It again reached the target due to volatility and hence closed the setup &#8211;<\/p>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"aligncenter\"><img decoding=\"async\" src=\"https:\/\/unofficed.com\/wp-content\/uploads\/2019\/06\/main-qimg-1fa373bc7310581c91e5b9d3d884cf3e.png\" alt=\"intraday trades\" class=\"wp-image-8619\"\/><\/figure><\/div>\n\n\n\n<p>But this time I did a mistake of selling 25000 PE because I didn&#8217;t anticipate the huge downside movement that happened today.<\/p>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"aligncenter\"><img decoding=\"async\" src=\"https:\/\/unofficed.com\/wp-content\/uploads\/2019\/06\/main-qimg-1c980a40bcee7085ef57f909cb6dfd5b.png\" alt=\"banknifty trades\" class=\"wp-image-8620\"\/><\/figure><\/div>\n\n\n\n<p>Today morning 25000 PE opened with a huge loss but today was expiry so I had the benefit of intraday margin as everything expires today only.<\/p>\n\n\n\n<p>So firefighting started to make the loss to green and closing it.<\/p>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"aligncenter\"><img decoding=\"async\" src=\"https:\/\/unofficed.com\/wp-content\/uploads\/2019\/06\/main-qimg-c13a9937e93bef793ee64f3a74f74af9.png\" alt=\"banknifty trades\" class=\"wp-image-8621\"\/><\/figure><\/div>\n\n\n\n<p>Then, it ended in profit after a deep headache. A headache is because this setup is automated in tons of accounts.<\/p>\n\n\n\n<p>It made around 7K on 150K.<\/p>\n\n\n\n<p>Now you tell me, which one you liked. The third one was an amazing adrenalin ticket haha.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>This week I had three different setups shared in Slack. Let\u2019s elaborate. Strategy A: This is the strategy I teach in Theta. Source: You can&#8230;<\/p>\n","protected":false},"author":1,"featured_media":6458,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[34],"tags":[],"class_list":{"0":"post-6457","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-learn"},"_links":{"self":[{"href":"https:\/\/unofficed.com\/theta\/wp-json\/wp\/v2\/posts\/6457","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/unofficed.com\/theta\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/unofficed.com\/theta\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/unofficed.com\/theta\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/unofficed.com\/theta\/wp-json\/wp\/v2\/comments?post=6457"}],"version-history":[{"count":1,"href":"https:\/\/unofficed.com\/theta\/wp-json\/wp\/v2\/posts\/6457\/revisions"}],"predecessor-version":[{"id":6459,"href":"https:\/\/unofficed.com\/theta\/wp-json\/wp\/v2\/posts\/6457\/revisions\/6459"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/unofficed.com\/theta\/wp-json\/wp\/v2\/media\/6458"}],"wp:attachment":[{"href":"https:\/\/unofficed.com\/theta\/wp-json\/wp\/v2\/media?parent=6457"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/unofficed.com\/theta\/wp-json\/wp\/v2\/categories?post=6457"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/unofficed.com\/theta\/wp-json\/wp\/v2\/tags?post=6457"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}