- the stock is having support around 192 levels
- resistance is seen around 218-220 levels
Given the setup one may consider Short strangle strategy for SBIN
Consider selling SBIN 30 July expiry
220 Call Option between 4.5 - 5 ( CMP 4.5)
185 Put Option between 4 - 4.5 ( CMP 4)
Lot size 3000
Profit potential Rs 25500/ - to Rs 28500/- ( total premium collection 8.5- 9.5) per lot as per CMP
Yield potential of 12.75% - 14.25%
Loss in strategy if closing on 30 July 2020 is below 176.5 or above 228.50
Take care & safe trading...!!!
It all depends on what your view is? And your comfort level with risk::reward ratio involved in the trade.
If your view is SBIN would close either below 178 or above 232 by 30th July, & if it actually does then ur strategy would break even at those levels.
At the same time any closing price between 190-220 on 30 July would make your Options completely worthless. So that would be your risk.
As long as you understand what your risk is and what the reward potential is and u are okay with what ever the outcome is, then your strategy is fine.