November 24, 2016

NIFTY option writing trades - III

These are my option writing trades from 1-NOV-2016. Previous trades are posted here.

MTM column refers to profit for the day... if net qtty is 0, then it means position is squared off.

1-NOV-2016
- sold 8700 call at 100. Qtty: 300
- 8600 put trade was a case of a positional trade becoming an intraday trade.
- because of above, I ended up buying 8700 puts... let's see what happens.
- if 8500 breaks on closing basis, I will be massively massively long in puts.



2-NOV-2016
- booked excellent profits in 8700 put
- sold some more 8700 call at 70. Qtty: 300. MTM profit 13K.


3-NOV-2016
- still holding short position in 8700 call
- added long positions in 8500 put


4-NOV-2016
- still holding short position in 8700 call
- added short positions in 8600 call
- max possible profit in above positions is 42000.
- booked profit in 8500 put; bought some 8400 put
- overall a nice day


7-NOV-2016
- no trading today
- holding overnight positions


8-NOV-2016
- reduced positions in 8400 PE
- otherwise did nothing


9-NOV-20016
- booked profits in all positional short trades.
- took 2 intraday trades
- first was good profit
- second was good loss thanks to RKSV servers facing severe errors.
- now no open positions


10-NOV-2016
- did nothing

11-NOV-2016
- traded short side 
- sold 8600 calls... this trade is still open
- and bought 8400 and 8300 put
- covered 8400 put in profit
- but messed up 8300 put trade badly very very badly


15-NOV-2016
- booked profit in 8600 call
- sold 8400 call around 35
- expected profit 27K if NF closes below 8400 this expiry


16-NOV-2016
- went for a one day picnic with friends
- here is the MTM for overnight positions ... 14K profit while on a picnic 


17-NOV-2016
- closed short position in 8400 calls
- initiated short position in 8200 call 
- also long position in 8200 call 
- no open positions now as I am expecting a trend reversal
- here is the MTM ... approx 17K in profits


18-NOV-2016
- intraday long trades by buying calls
- small profits but good for the day (could hv been worse)


22-NOV-2016
- initiated long by buying calls and writing puts in first 10 minutes
- exited at loss
- failed to initiate fresh trades
- in hindsight, original view was perfectly correct
- better trade would have to trade after 1 hour
- by then, markets would have come down and long trade would be near supports
- alternatively, had positions been small I would have probably held on.
- lesson learned


24-NOV-2016
- did nothing today and yesterday
- let's see how the next series pans out.


19 comments:

  1. Sir,

    You are long in 8700pe (600)and short in 8700ce (300). This is effectively strong conviction short like naked NF short. Wheres the hedge ? Or i am missing something ?

    Regards,

    ReplyDelete
    Replies
    1. There is no hedge... I am expecting markets to go down for a short while.

      Delete
    2. I will be big time short below 8500. Of course, with proper SL etc.

      Delete
  2. Sir,
    How do U decide upon proper STOP LOSS in Option Trading?
    mamata

    ReplyDelete
    Replies
    1. Use support and resistance levels as explained in http://www.vfmdirect.in/2015/03/my-trading-strategy-explained-in-one.html

      Delete
    2. Thanks Sir,
      But do we use this method for NIFTY OPTION charts i.e is it ok to trade OPtions using their charts???

      Delete
    3. Yes... you can. In fact, it is better to use the option chart instead of underlying.

      Delete
  3. This comment has been removed by the author.

    ReplyDelete
    Replies
    1. Good... just be consistent and follow methods explained in http://www.vfmdirect.in/2015/03/my-trading-strategy-explained-in-one.html

      Delete
    2. Thank you sir for advising to skip stocks making lower low like Idea... but to concentrate on stocks giving breakout. Following your advice. I did make some profit today.Thanks again for above link...sorry for deleting previous message and rewriting again.

      Delete
  4. These option writing trades section is good learning. Thank you sir!

    ReplyDelete
  5. Sir,

    You said "but messed up 8300 put trade badly very very badly". What has happened? could you please explain? Something we should aware during put buying?

    Thanks

    ReplyDelete
    Replies
    1. The 8300 put shd have given a profit of 10-15K and the 8400 put a profit of 30K... this is assuming the position was held till market close.

      I got much less because of faulty SL. I had a loss on the 8300 put but I should have repeated the trade again.

      Delete
  6. twhats the stratergy for Tuesday trade?

    ReplyDelete
  7. Strategy is explained at http://www.vfmdirect.in/2015/03/my-trading-strategy-explained-in-one.html

    ReplyDelete
  8. - You said "but messed up 8300 put trade badly very very badly". What has happened? - You answered "because of faulty SL" -- Wan to know - Was this due to severe RKSV Server lock down resulted in "Faulty SL" or the time period to take the decision for keeping the PUT and not taking profit on SEVERE volatility bout on that specific day resulting in SL Hit (not as per the Trade execution RULE based SL). Pl explain the "Faulty SL" in detail as the strategy you put in requires utmost PATIENCE with NINJA style trade execution speed on such volatile days like the 8thNov and 9thNov where no retail customer could have caught the low of 8076 in NIFTY future (74pts-premium) and the high price in Option 8300 put 204.25( High),Open-84.20,Low-42.60, close-56.15. The real action started @9.45 am for retailers after 8160 future

    Want to know exactly how to manage such type of trades on these scenarios, your in-depth explanation could help in regaining the Psychology behind handling volatile days

    Thanks

    ReplyDelete
    Replies
    1. Exited the trade even though SL was not it. And then when markets started selling, I failed to re enter.

      Delete
  9. I have a question on execution aspect of your FnO trades. Do you place Market or Limit or SL-L or SL-M orders for entry/square-off. What max qty you place in a single order?

    ReplyDelete
    Replies
    1. I rarely enter the SL in the trading system unless I have to go out (then it is SL-M).

      My max qtty per order is 900. Min is 300. If I am expecting a big positional move (like when it broke 8500), then I scale up to 2400 or even 3000.

      Delete