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    This document outlines a derivative trading strategy for Bank Nifty options expiring on March 23, 2017. It recommends a buy/long position on Bank Nifty put options with a strike price of 21,000. The rationale is to buy put options if the open and high prices are the same or if the difference between high and open is less than 0.5% of the underlying value and less than the difference between open and low. It provides details of the trades, including buying 240 options at Rs. 55 each, and then selling portions of the position at 25%, 50%, and 200% profits to take profits from the strategy. The overall expected profit before brokerage and taxes is Rs. 8,250.

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    Derivative Strategy

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    This document outlines a derivative trading strategy for Bank Nifty options expiring on March 23, 2017. It recommends a buy/long position on Bank Nifty put options with a strike price of 21,000. The rationale is to buy put options if the open and high prices are the same or if the difference between high and open is less than 0.5% of the underlying value and less than the difference between open and low. It provides details of the trades, including buying 240 options at Rs. 55 each, and then selling portions of the position at 25%, 50%, and 200% profits to take profits from the strategy. The overall expected profit before brokerage and taxes is Rs. 8,250.

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    © All Rights Reserved
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    34 views1 page

    Derivative Strategy

    Uploaded by

    vadlapatis
    This document outlines a derivative trading strategy for Bank Nifty options expiring on March 23, 2017. It recommends a buy/long position on Bank Nifty put options with a strike price of 21,000. The rationale is to buy put options if the open and high prices are the same or if the difference between high and open is less than 0.5% of the underlying value and less than the difference between open and low. It provides details of the trades, including buying 240 options at Rs. 55 each, and then selling portions of the position at 25%, 50%, and 200% profits to take profits from the strategy. The overall expected profit before brokerage and taxes is Rs. 8,250.

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    © All Rights Reserved
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    of 1

    DERIVATIVE STRATEGY NOTE

    UNDERLYING: BANKNIFTY

    INITIATION DATE: 20 MARCH 2017

    EXPIRY DATE: 23 MARCH 2017

    TRADE TYPE: BUY/LONG

    BANKNIFTY UNDERLYING VALUES

    TYPE OF OPTION: PUT

    (RATIONALE:

    BUY PUT IF

    1. OPEN AND HIGH ARE SAME

    OR

    2. IF HIGH - OPEN IS
    a. LESS THAN 0.5% OF UNDERLYING VALUE
    AND
    b. LESS THAN OPEN LOW OF THE DAY )

    ELSE BUY CALL

    STRIKE PRICE: 21000

    (SELECT THE STRIKE PRICE WHICH TRADE BETWEEN 50-70 AT THAT POINT OF TIME)

    OVERALL STRATEGY WITH VOLUMES

    TRADE TYPE OF STRIKE


    UNDERLYING ACTION QUANTITY RATE AMOUNT REMARK
    NO. OPTION PRICE
    1 BANKNIFTY PUT 21000 BUY 240 55 -13200
    2 BANKNIFTY PUT 21000 SELL 120 68.75 8250 SELL HALF AT 25% PROFIT
    3 BANKNIFTY PUT 21000 SELL 80 82.50 6600 SELL ONE THIRD AT 50% PROFIT
    4 BANKNIFTY PUT 21000 SELL 40 165 6600 SELL BALANCE AT 200% PROFIT
    PROFIT/(LOSS) IN THIS STRATEGY BEFORE BROKERAGE AND TAXEX 8250

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