dravya

IDEA - Strangle Option Strategy

NSE:IDEA   VODAFONE IDEA LTD
CMP - 100

This is a direction-neutral strategy. I used it previously too. ( see in related idea )

Here I am buying,

95 PE - 3.5
105 CE - 3.5

Why ? Because it has moved a lot and I am expecting it to move further.


Caution : Experts do due diligence. New traders can look into this and paper-trade.
Trade active: Currently in negative. Volatility crunch bigger than the movement till now.
Vega drop overpowering delta gain.

Need to see some more delta. If it rebounds, an exit is planned.
Trade closed: target reached: CMP - 87.6

12.4 Rs down from a week ago.

Now,

95 PE - 7.6
105 CE - 0.05

Total selling price - 7.65
Total buying price - 7.00

Net - 0.65 * 7000 = 4500 on 49000 capital.

around 10 % in a week.


actually there were more adjustments to be made as the stock moved, to manage the greeks. which will be done next time.

This was a risky trade. Was in negative for a fair amount of time.

The stock can go down more, but I want to exit this position and create better ones.

Regards.

Comments

Sir. Any chance of going down? I'm holding 80 Put for march expiry.
Reply
dravya rajil
@rajil, It'll all depend on the valuation being figured out. There are multiple clauses in the deal. The stock can go anywhere, but below 80 is risky before March. 72 is the least they were telling and the deal in going to be completed next year.
Reply
Interesting, good strategy.
Reply
dravya AMBRISH
@AMBRISH, Thanks. This time a bit riskier than previous occasion but I am hoping it does move good in any direction.
Reply
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