Looking at the current chart pattern and the index movement, a relatively safe strangle for 22 may is given
Sell 49000 Call at 13 and 47100 Put at 10.4 for a collective premium of 23.4.
This is a naked strangle and any sudden surge or gap openings can spike the option prices exponentially.
To make it safer one can buy the respective options closer to the sold ones , thereby it will have a defined loss and a defined profit.
I am taking this naked strangle with 2000 qty, and will do necessary adjustments if needed , by keeping sufficient margin in hand.
Sell 49000 Call at 13 and 47100 Put at 10.4 for a collective premium of 23.4.
This is a naked strangle and any sudden surge or gap openings can spike the option prices exponentially.
To make it safer one can buy the respective options closer to the sold ones , thereby it will have a defined loss and a defined profit.
I am taking this naked strangle with 2000 qty, and will do necessary adjustments if needed , by keeping sufficient margin in hand.
Comment:
Call from 13 to 8.5 and Put from 10.4 to 9.4, call decay / crash by 25% done already. Perfect setup
Trade closed: target reached:
100 % profit, both options Zero, even though market made a wild swing taking a lot of stop losses and causing many a heart beat faster, but such is the drama of expiry day, that is why its best to trade far OTM and cover the trades when decay is 90%.