[00:00] In today's video, we are going to talk about a new option strategy. We have been backtesting some options strategies for months now. We felt that we were better off with four options strategies.
[00:14] But even in those four, those who earn money by doing options strategies with less chance of getting a market-related income, are getting confused about these adjustments and taking unnecessary risks.
[00:26] Even though they are saying that they want to trade with new options, those who are losing money by not having the right knowledge and practice in the market,
[00:41] and the methods and processes that we follow, and the consistency of the process that we follow, I will bring to you the best strategy that we have found in those practices.
[00:55] Because, I did not bring this strategy to you to test live trades in the last week or the previous week.
[01:08] I have been assessing the percentage that is possible when we should go for the next month, I have assessed all these multiple parameters and this is the best in the present market.
[01:25] We can aim big returns. I can personally think of all these and I will get the confidence to tell this to my people. When our people listen to this, when they practice, they will also feel this.
[01:38] I can talk so strongly in confidence. If you listen and do it in the market immediately, you will not get that confidence or that feel. What you should do is, instead of trading in the open market,
[01:52] you should trade the paper and understand that what he is saying. What he said may be for the video. Who knows? I should also get excited about that strategy.
[02:07] When I get excited and tell you, you should also get excited about that strategy. Do paper trade. If you get excited and if all the logic is applied in the market as we think,
[02:19] Otherwise, do not do it. if you feel that this is the right time and overall, if possible, for 3 months, when you do paper trade,
[02:35] You can observe the strategy. In the negative or positive situations, you can get profit.
[02:49] Even after I take it, there will not be much in the starting. If you feel this is the best, you should use it. Yes, I will definitely do paper trade.
[03:03] Otherwise, I will not use it. I will tell you to note it down. If you do something else after changing it,
[03:15] You are doing another new strategy. have you seen the previous strategy of the strangle? Moreover, you will follow that strategy in today's video also.
[03:28] It will be like a copy-paste of the triangle. Moreover, you can think of this as a triangle 2.0. who are unaware of the market and are doing whatever they want.
[03:44] They will go to the market thinking that they know everything. Their mind will be blocked. This is a strategy that is less risky and less rewarding for such people.
[04:00] I am telling you this to bring any strategy in front of you. If we see this and understand it, we will feel that it adds value to them.
[04:12] It will take some time. If we don't tell the strategies on the strategies, Particularly, for option strategies,
[04:25] So, in the upcoming days also, strategies that we feel confident can be late. we will not try to hide them.
[04:39] Shall we start the video? It may be a small strategy while listening. to bring it in front of you for the confidence that we should have.
[04:54] have come in the same way. We will bring them in front of you in the upcoming times also. when you feel our efforts are valuable,
[05:06] please like the video and try to encourage our efforts. The efforts we are making are good and the encouragement you give us. Just keep it in mind so that you don't get confused.
[05:20] In this, we will only touch monthly expiry options. The second important thing is you should have clarity on how much percent return you want on your money.
[05:33] In this strategy, we aim for 2% to 3% per month. In some cases, we will get as much as we expected. In some other cases, we may get loss.
[05:47] If we look at yearly, it is 24% to 36%. This is a very important point. Because we have observed this strategy keeping this percentage of return in mind.
[06:02] Many of us want 5,000 or 20,000 or 30,000 per month. But we never think about the percentage of return on capital.
[06:14] I don't know if you have such mindset. How much is 2% to 1 lakh 9,000? Just open your calculator.
[06:29] 1 lakh 9,000 multiplied by 2% 2% means 2 divided by 100. If you multiply 1 lakh 9,000 by 0.02
[06:46] Then you will get 2% return on 1 lakh 9,000. If you want 2% return on 1,50,000 capital, it will be 3000 rupees
[06:59] If you want 3% return on 1,56,000, it will be 4680 rupees This is the second point where you should get an idea of the percentage of return on capital.
[07:13] Second point is that there will be returns on the basis of percentage. We see this strategy after taking 2% in the minimum and 3% in the maximum.
[07:25] We see this return only after taking brokerage charges separately. If you think 2% and 3% what will be left if take away charges from it, Net profit will be the same.
[07:40] How much capital does this strategy require? For Nifty the capital should be around 1,00,000 We can reduce capital by hedging without any hedge.
[07:55] We can reduce capital by half or even more than half. But, it will play a different theme related to it. Strategy Rule No. 1
[08:08] You should divide the month in this way. First, you should see the contracts in the first two weeks.
[08:21] Then, you should look at the contracts related to the month in the first two weeks. You should look at the contracts related to the same month. You should look at the next months contracts for week 3 and week 4.
[08:36] So, I will look at the contracts related to the month of June. I have June 8th. After I finish these two expiries,
[08:49] I will not take the next one related to June. From June 15th onwards. You might have to change it before June 15th.
[09:01] I will square off my position till June 15th. I will close it and go to July. I am going in June half.
[09:13] I will be in July contracts. So, the month you are entering, From next month onwards,
[09:25] I think you are understanding. you will go to July contracts from half. from June half, you will be in July contracts.
[09:37] you will be in July contracts. for 4 weeks every month. And this is important.
[09:49] which strike price to select, Purely depends upon our capital. When I showed you in the baskets,
[10:01] What is the required margin here? It can be profit or loss. So, even if you keep a 10% margin,
[10:13] Nifty related. 2000 rupees. If you want it weekly,
[10:25] How much do we need per week? we need to earn 500 rupees or 0.5% return per week. So, in our mind,
[10:37] should be in our mind, 0.5% or 500 rupees. But, we don't select a premium based on this.
[10:51] We take 3%. in the process of selecting based on 2%, because we take it monthly.
[11:03] even if it is less from here, when we want to select a premium, and select premiums based on that.
[11:15] So, should we calculate on 1 lakh? So, here also, I will explain you by taking 1 lakh 20 here also.
[11:27] I am taking 1 lakh 20 thousand. In 1 lakh 20 thousand, 2,400 rupees.
[11:39] 3,600 rupees. Are you doing Nifty or Bank Nifty? You can do Bank Nifty with similar rules.
[11:51] Divided by, 50. It can increase or decrease. What is the present lot? 50
[12:03] 48. But, we will sell one call and one put. we have to sell 24-24 premiums.
[12:15] we have to sell 24-24 premiums monthly. If we want 24 call side, And, if it is downside,
[12:27] 17,750 or 17,800. How much is 3% in 1,20,000? 3,600 divided by
[12:39] Divide by 2. Where is 36 premium? 34. And, downside?
[12:51] We will sell this pair. you can calculate premium selection I will show you how I executed this
[13:03] You will understand logically. This is directional option buying related I will exit as soon as market opens.
[13:15] immediately after market opening. It has exited. When I was looking at 36,
[13:27] and another at 36. We enter into strategy. on capital.
[13:39] I came to 3%. it is not because you expect 3% per month. Our monthly target is 2%.
[13:51] I entered. should we make adjustments. No! our people have seen the strategy
[14:03] in live markets. the market fell 200 and then another 200 it got reversed.
[14:15] Range bond to medium volatile. and if Nifty rises, anything is same But if the range bound to medium volatile,
[14:27] we are going to talk about. Our view is 2%. it is 0.5%.
[14:39] If it is Nifty related, For 1 lakh, what will be the 0.5% return on 1 lakh? But if you notice, while buying and selling
[14:51] I will talk about this brokerage in the last. but it is not the reality. I will look at my 0.5% return
[15:03] I will tell you what to do after exiting. in this live strategy. I took it on May 29th.
[15:15] I took it on 9:15 AM, These are the prices in the opening and closing time. around 11 or 12 in the morning,
[15:27] I thought it was 600. I exited after that. What to do now?
[15:39] Why did we say that this strategy is second version of strangle I will explain it now. 19,200 call
[15:51] But the market fell after I took it. but we got the 0.5% profit. including brokerage charges.
[16:03] I exited at 600. 17,800 put I came 50 points ahead.
[16:15] Let's say the market is at 18,000. sold 19,000 call The market
[16:27] Even if it falls to 17,800, will decay more than the put. plus brokerage charges,
[16:39] Again, what is the capital? what premium do we need? if the call is more than the put,
[16:51] Again, at 17,800, the options that are close to 36, 36 premium Because of this, our range will expand.
[17:03] any direction We will change both. If it reverses,
[17:15] In fact, the market fell to the downside that day. If it reacts so much, The loss in the put will increase.
[17:27] observe the edge in this. even if the market moves neutral to medium volatility This is the main advantage.
[17:39] If we keep getting profits, form a new range related to the market. fell by 600-700 points.
[17:51] If we make adjustments, it will be risky to carry the straddle overnight. you will get a profit.
[18:05] You will get a fresh entry with the same gap. The call side is premium. After taking the put, the market still fell.
[18:17] What is that? you will get 0.5% profit. I will show you live.
[18:29] Now, it is 17,800. I will show you the chart. Still, the call fell more than the put.
[18:41] I did not get the brokerage charge of If that comes, I will exit. I got a higher profit than I expected.
[18:53] But, I got a lower profit than that. I closed the premiums. that I expected.
[19:05] that I expected. again I sold them 0.5% on my capital is
[19:17] That means 2000. I will exit from here I got 3% on my capital.
[19:29] the real return that I expected I expect 0.5 on a weekly basis. I will not wait for the whole week.
[19:41] I got 0.5 today. You should remember the difference. for premium selection.
[19:53] it is based on 2% I wanted to keep both the numbers same. You should keep 3% on 1 lakh and select premiums.
[20:05] and get that 1 lakh. If the market reverses at any point, for a month.
[20:17] is better than the previous one. We square off the positions We will get the same profit
[20:29] We will exit. I hope you didn't get confused. The market is at a particular level.
[20:41] it is 36. It is 18500 and 17500. If market fell by 200 points.
[20:53] Now, the market is at 17800. What do we do with the usual strangle? But, before getting 50%,
[21:05] will trigger the profit. Let's see the adjustment till 50%. We should take a new range.
[21:17] we can see the premium. it can be at Now, it can be at
[21:29] It is reversal. It will decay compared to the increase in this. we get 0.5% profit here.
[21:41] we exit and go up the range. I am explaining the profitable scenarios. You understood, right?
[21:53] We should not let the market till the point we should make adjustments. 0.5% when we go far away we avoid
[22:05] we see 0.5% target. It is 100% sure. It is our experience.
[22:17] There is no requirement for adjustments. is only 2-3%. If you are looking at the market with 10%,
[22:29] Whatever I say, it will not satisfy the strategy. It will be a different strategy.
[22:41] The market has moved volatile. the increase in premiums did not satisfy the other. as I said in the strangle,
[22:53] One went to 50 and the other came to 25. 11 is the only one that is reduced. We did the sell here.
[23:05] But the premium is double. if the premium is less than half, we will adjust it.
[23:17] 80% in this is We will see where the 40 premium is All the adjustments are from strangle.
[23:29] These are perfect golden rules. the best rules are still there. But if we get 0.5% profit without going to the rules,
[23:43] We are protecting ourselves. I hope you understood this strategy better. Monday.
[23:55] I got 0.5% return already. If I get another 0.5% I will exit this too.
[24:07] I have to complete Friday. I got 1% return in less than 1 week. the market is falling.
[24:19] Compared to what we expected, in the 4 weeks we traded. in less than 1 week,
[24:31] If this continues, We expected 2%. We will take 4%.
[24:43] take the extra market. If we are better in that month, Or less than that.
[24:55] Because we don't have rules for everything to happen. everyone will do the same. how we think about it particularly,
[25:07] is not about the profit.  Beginners, how much can they protect their capital? The loss should be minimal.
[25:19] The risk to reward should be better. When we wanted to talk about strategy, when the market was falling,
[25:31] When the market was reversing, We were looking for 0.5% decay or 0.5% capital return. We got an opinion that
[25:43] That's why this video is in the form of strategy. gap up gap downs. There is a risk of gap up gap downs.
[25:55] it became a straddle, what should you do next? 0.5% target, exit.
[26:07] Loosing without getting 0.5% return. Because of the increase in the VIX. First two weeks, we will be in the same month.
[26:19] Let's say this is the same month. we will be in June. July 1st and 2nd week we will be in July.
[26:31] From there, we will maintain Let's talk about brokerage. we will get a brokerage of 100 rupees.
[26:43] we will get this brokerage. let's say you are doing it with hedge or capital, I will have to pay 25 rupees
[26:55] If I want to buy again, I will have to pay 25 rupees. Each side is taking 20-25 rupees. I am taking 100 rupees with 25 rupees.
[27:07] to sell once, 25 rupees. So, nearly 50 rupees is going to be lost. if you make 500 rupees,
[27:19] it will be 43 rupees. What it costed for 9 lots is not as much as 1 lots. So, if you follow it with a lot,
[27:31] But, if you increase the number of lots, The trading cost will be reduced. not as per the no.of lots
[27:43] So, I hope you got the clarity I will show you an example related to Bank Nifty. If we want to sell this particular theme,
[27:55] 1,20,000. So, multiply by 0.03. Divide by 2.
[28:07] You have to sell the option premium worth 72 Where will 75 be? almost 45,800.
[28:19] to show you Bank Nifty, If you go to it will be around 75.
[28:31] So, you sell 41,600 put You need In that, 0.5% return plus
[28:43] If it comes, we will exit. it won't be like this. Rest, when adding 9 lots,
[28:55] So, to do one lot, No matter how many lots we do, So, number of lots will increase
[29:07] Remember this. premium based on If you have 2 lakh capital,
[29:19] 6,000 rupees. divide by 50, divide by 2. 60-60 premium.
[29:31] we can do 2 pairs of Nifty lots. we can do 30-30-30. is related to one pair.
[29:43] you can do it. Look at the logic for one pair. keep the number of quantity.
[29:55] You can calculate return But, if we have 1 crore capital we need 2 lakh rupees.
[30:07] how premium we can do. for the pair of call and put, We can't sell premiums
[30:19] I am telling this because They will make mistakes. important information related to this video.
[30:31] I might have discussed too much. I am sorry to say. that require 13-15 minutes.
[30:43] I can't do it until I am sorry to those who say I can't do it.
[30:55] I have to clear all the data I have a feeling that I have told you everything. Do you have any doubts?
[31:07] related to this video I want you to know a subject Did you find the video interesting?
[31:19] and if you think we have added value to it, If you want to support us go to websites
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[31:43] our channel will get the benefit. If you think our content is valuable, I will come back with another interesting video.
[31:55] Jai Hind!