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How and when should apply which Option's strategyHey everyone! 👋 This post is just for sharing knowledge about Future and Options strategies, First of all, one should build view (bias) on market direction, it may be bullish, bearish, sideways, or there may be some events too, like budget day or quarterly results seasons or may be something else, once view is built then what are the ways to apply futures and options strategies are shown in this post. Options trading may sound risky or complex for beginner investors, and so they often stay away. Some basic strategies using options, can help a novice investor protect their downside and hedge market risk. Options trading is meant to provide a process that defines the selling and buying of options by a trader. The options trading strategies are what make up the options trading. There are various ways that a trader can use the options trading strategies to their advantage. Options trading is a great way to increase your returns as an investor. You will be able to generate profits when the market goes up or when it goes down. However, with so many options trading strategies on offer, you may find it difficult to know which one to choose. This post is showing ideas of the different options strategies and help you choose the right one based on your views. What Are Options Strategies? Options are one of the most flexible and powerful way for investing in the stock markets. Investors can utilize stocks in many ways, including buying and holding onto them to long-term appreciation in value or short-term trading to make a quick buck. However, the stock market is huge, and investors can utilize many sophisticated strategies. The first complex strategy is called a call option. Call options are contracts that enable the holder to purchase a stock or other asset at a specific price within a specific time frame. If the price goes above the strike price, the owner can buy the stock at a lower price and then sell it at a higher price. This can result in a great return, but a loss is possible if the stock doesn't move or move in opposite direction. Types of Options Strategies There are four ways to trade options strategies : call, put, spread, and straddle. First, let's start with the call and put. A call is a contract that gives the owner the right to buy a stock at a specific price on or before the option's expiration date. On the other hand, a put is a contract that gives the owner the right to sell a stock at a specific price on or before the option's expiration date. Spreads and straddles are both strategies used to manage risk. A spread is created by buying the same type of option with the same expiration date but with a different strike price. The strike price is the underlying stock price when the option is exercised. A straddle is created by buying an option with a lower strike price and an option with a higher strike price with the same expiration date. Pros and Cons of Options Strategies Just like selecting a stock to trade or invest in, selecting an options strategy can be a difficult task with risks and potential payouts. The pros and cons of options strategies help you decide which is best for your investing style. Pros: - Lower investment costs​ - Stock options can be used as a way to hedge your investment or portfolio risk Cons: - High risks and losses can occur if you don't research your options strategy​ - Options can only be exercised at the expiration date​ Conclusion Traders can use Options strategies to take advantage of both rising and falling prices of stocks. We hope you have gained a deep understanding of what options strategies are this post. See you all next week. 🙂 RK_Charts Most investors treat trading as a hobby because they have a full-time job doing something else. However, If you treat trading like a business, it will pay you like a business. If you treat like a hobby, hobbies don't pay, they cost you...! Disclaimer. I am not sebi registered analyst. My studies are for educational purpose only. Please Consult your financial advisor before trading or investing.
NSEIX:NIFTY1!Education
by RK_Chaarts
125
Nifty can be positionaly buy Nifty affecting indicies Dow and Nasdaqe looks positive for next 2 weeks, We can see 32150 & 32850 levels on Dow, That means Indian markets may trade positively for next few days, There may be some minor corrections in some days, but overall we can see 16750 on Nifty and 35800 on Banknifty in next 1-2 weeks,Important Support for Nifty would be 15965 and 34275 for Banknifty, One can create long positions specially in Nifty , Can accumulate 16200 CE of 21st July Expiry from 16200 to till 16050, with the Stop loss of 15965, Average price would be 150 and the targets may be 550-600 before 21st July Expiry.
NSE:NIFTYLong
by IndexxTrader
BankniftyBANKNIFTY 30JUN2022 32500PE (Sell) =82.4 BANKNIFTY 30JUN2022 34500CE (sell) =93.15 BANKNIFTY 30JUN2022 33000CE (buy) =817.35 BANKNIFTY 30JUN2022 34000PE(buy)=582.7 max profit in this trade=6888 max loss in this trade=5613 Breakevens 32776.0-34224.0 days left for expiry 4 amount required to trade this strategy 68,817.44/-(calculated from Icici direct brocker account) ensure all trades are executed otherwise loss may be unlimited. Probablity of profit=49% Risk to reward =1:1.2
NSE:BANKNIFTY1!Long
by VipinSharma
nifty 16june 2022hi here is a limited risk and limited reward strategy for nifty options NFO NIFTY22616 OPT-PE 16000 50 Buy 0 0 0.00 0 NFO NIFTY22616 OPT-CE 16600 -50 Sell 64536 16201 0.00 80737 NFO NIFTY22616 OPT-CE 16400 50 Buy 0 0 0.00 0 NFO NIFTY22616 OPT-PE 15800 -50 Sell 64336 16201 0.00 80537 the trade is in single lot minimum amount required for this strategy is 33000 max. reward is 5670 max. risk 4328. risk reward ratio 1:1.3 Breakeven 15914.0-16486.0 probability of profit is 48% (above table is from my brocker website data) no of days remaining expiry =3 days take the trades as per your capacity, ensure all trades are executed otherwise risk will become unlimited. market goes is any direction max risk and reward is specified. you can exit the position as per your profit/loss bearing capacity ;)
NSE:NIFTY
by VipinSharma
Nifty PRZ trade plan.Nifty formed a base on 9.5.2022 and has re-tested that base thrice. It gave a good bullish move after that and is trading around previous day high. The overall sentiment and trend of the market is still bearish. Also Nifty has formed a BEARISH DEEP CRAB formation and the PRZ level comes around 16450 . One can take a bearish trade once Nifty touches 16450 with a SL of 16485 on a 15 mins closing basis. The reason for the SL is that 16478 is the SL for the harmonic pattern and 16484 is the high of 6.5.2022. One can keep the the following targets according to Fibonacci :- T1 - 16404 T2 - 16375 T3 - 16352
NSE:NIFTYShort
by pareshdevnani
LIFE OF A NOOB TRADERHello !! Welcome to the trading psychology of a noob trader. We all know most people lose money in stocks as they do not have a proper idea about investing and invest randomly in any stock without looking technically or fundamentally. In order to stay in the market, one needs to be patient and hold the horses when the market dumps as nothing goes down forever. Most of the new traders buy stocks that are overhyped and when it starts dumping they sell them rather than accumulate more of them. In the long term, the market eventually goes up and one needs to know the law of compounding and invest more when the market dumps but the opposite happens and they lose out on their capital. The poorer get poor and the richer get richer as they have mastered the secret of long-term compounding. Invest Early and slowly !!
NSE:RELIANCEEducation
by ScramblerG