---
title: 'Fin Nifty for Beginners'
source: 'https://youtube.com/watch?v=XtjhO6uHISc'
video_id: 'XtjhO6uHISc'
date: 2026-08-19
duration_sec: 1304
channel: 'DAY TRADER తెలుగు 2.0'
---

# Fin Nifty for Beginners

> Source: [Fin Nifty for Beginners](https://youtube.com/watch?v=XtjhO6uHISc)

## Summary

This video provides a comprehensive beginner's guide to trading Fin Nifty, an index representing India's financial services sector. It covers the index's composition, its volatility compared to Nifty and Bank Nifty, margin requirements for F&O trading, and strategies for option selling with limited capital.

### Key Points

- **Introduction to Premium Decay** [00:00] — The video opens with a warning about the temptation to move strike prices closer to the market as premiums decay, advising viewers to control themselves and maintain low returns.
- **What is Fin Nifty?** [01:16] — Fin Nifty is an index representing the financial services sector, including banks, NBFCs, and insurance companies. It has its own futures and options contracts.
- **Fin Nifty's Launch and Strike Price Changes** [02:52] — Fin Nifty came into the limelight in 2021. The NSE changed the strike prices to improve liquidity and trading activity.
- **Nifty 50 Composition** [03:05] — Nifty 50 is based on the top 50 companies by market capital in India. However, not all stocks have equal weightage; some have more influence than others.
- **Bank Nifty Composition** [04:13] — Bank Nifty consists only of banks. Tracking the top 5 banks (HDFC, ICICI, SBI, Kotak, Axis) covers about 80% of its weightage.
- **Fin Nifty vs Bank Nifty Overlap** [05:23] — Fin Nifty and Bank Nifty have a significant overlap, with banks holding more than 60% of the weightage in Fin Nifty. This means moves in one often affect the other.
- **Volatility Comparison** [07:28] — Fin Nifty is more volatile than Nifty but less volatile than Bank Nifty. This makes it a middle-ground option for traders.
- **Margin Requirements** [08:14] — Fin Nifty requires lower margins compared to Nifty and Bank Nifty. However, it's important to compare the contract size and the percentage of margin charged, not just the absolute amount.
- **Futures and Options Costs** [09:11] — Buying Fin Nifty Jan futures costs around Rs. 1,02,000, while selling costs Rs. 1,01,000. The difference includes STT (Security Transaction Tax).
- **Lot Size and Option Buying** [10:37] — Fin Nifty has a lot size of 40. Buying an option at a premium of 160.85 would cost Rs. 6,400 (40 * 160.85).
- **Hedging to Reduce Margin** [11:10] — By using a spread strategy (selling a call and buying a higher strike call), the margin requirement can be significantly reduced, allowing traders to trade multiple pairs with the same capital.
- **Option Chain Analysis** [12:33] — Viewers are guided on how to access the Fin Nifty option chain on the NSE website to analyze open interest, volume, and support/resistance levels.
- **Expiry Day and Volatility** [14:25] — Fin Nifty has a Tuesday expiry. This has increased volatility in bank and financial stocks on Tuesdays, so traders should be cautious.
- **Strategy Backtesting** [15:08] — The video mentions backtesting the regular income and 30% intraday strategies on Fin Nifty using ALGOs to observe probability and drawdown.
- **Golden Rules Strategy** [16:08] — The golden rules strategy, originally for Nifty and Bank Nifty, is also working on Fin Nifty. The 30% option selling strategy is recommended for high volatility conditions.
- **Option Buyers vs Sellers** [18:10] — In recent times, Nifty has moved from 17,800 to 18,300. There are days for option sellers and days for buyers. Following rules and metrics is crucial for stability.
- **Risk Management Advice** [19:32] — The video advises starting with far-away strike prices and bringing them closer only when comfortable. It warns against moving strikes closer just because premiums decayed, as this can lead to losses.

### Conclusion

Fin Nifty offers a balanced alternative to Nifty and Bank Nifty, with lower margins and moderate volatility. By understanding its composition, using hedging strategies, and following disciplined rules, traders can effectively trade this index.

## Transcript

They say, that they are putting the premiums far away from the market at the starting. If that is decaying, then we are bringing the premiums closer to the market. So we are bringing the premiums closer to the market.
Have you ever done this in recent times? Don't get tempted in any situation. 80-85% of them will be tempted like this.
You have to control yourself and keep a low return. you have to change the risk according to your risk apatite. In recent times, compared to Nifty and Bank Nifty,
And there is liquidity in recent times too. and the 30% stop loss strategy that we talked about in intraday, and the possibility of success in applying in Fin Nifty,
many questions have been asked in recent news videos. Because, if you want to trade in Nifty in any trading platform, If you go down the strike prices and down the downside,
So, let's learn about Fin Nifty in today's video. Like, we have Nifty 50, Nifty Bank, and Bank Nifty.
It has futures and options. Which stocks are there to increase or decrease Fin Nifty? if we want to trade in futures and options,
compared to Bank Nifty and Nifty, I will answer that too. how to reduce money and trade in F&O?
you will get better returns and low volatility. we will discuss the entire concept related to Fin Nifty in today's video.
regular income strategies and 30% intraday strategy I will end this video. If you find these videos and the efforts we are making to bring you in front of you valuable,
do like the video and try to encourage the efforts we are making. when you think our efforts are worth it, So that, this video reaches more people
will be helpful to reach our people. let's talk about Nifty and Bank Nifty, we have been trading in these for a long time.
it came to limelight in 2021. They have changed the strike prices. If they bring it in,
So, what is Nifty 50? Based on the top 50 market capital in India, Like, will every stock in Nifty 50 have an equal weightage?
Some stocks in Nifty 50 have more weightage. And some have only 10 stocks.
have a very negligible weightage So that, when we focus on Nifty related trading, if we can analyze the top 3 or top 4 stocks in these 10 stocks,
So, we can see the possibility of Nifty moving in which direction. We have already made a dedicated video on this.
So, you can click on that and get complete information about Nifty 50. we have to give priority to stocks with high weightage.
but multiple sectors, have formed Nifty 50. There are only banks in bank nifty.
You can see the names on the screen. But, you can see that HDFC bank and ICICI bank If you can only analyze these two stocks,
If you can track SBI, Kotak Mahendra Bank, Axis Bank, then you are tracking 80% of the weightage of bank nifty.
It is important to see the support and resistance there. It is also important to observe the trend of the heavy weights in all of them. If these banks move, bank nifty will move.
So, ICICI bank, HDFC bank, State Bank of India, Kotak Mahendra Bank, Axis Bank, So, it is important to know the weightage of the inter-all companies. Even in that, there is high weightage for private sector banks.
What is the situation of financial services in Nifty? Friends, there are banks, NBFC, and insurance companies. Please observe the screen clearly.
Axis Bank, State Bank of India. more than 60% of the weightage is given to the banks. NBFCs, insurance companies,
So, bank nifty and nifty financial services overlap. Almost 60% of the weightage is similar to the weightage in these. In FINNIFTY or in Nifty financial services,
the majority weightage is 60% or above. will be given to NBFC, housing finance companies, and insurance companies, Nifty financial services has been created as if it represents the entire financial sector.
We already have Bank Nifty/ Why do they need another index? they will be profitable if there is more trading.
Where do you think the trading is happening? According to historical data, FII's open-interest or trading activities.
They are shown in financial or banks related instruments. If you observe the FII activity of the instruments related to banking, So, they tried to bring other indices,
Because, bank nifty has a good FII activity. They tried to create financial services and Fin nifty,  thought it might work better.
So, NSE brought the index with a plan. They believed that bank nifty will generate volume in this too. Now, Fin nifty is successfully enjoying traders' attention and liquidity.
Will it be like Nifty or bank nifty? I have been hearing that Nifty compared to bank nifty have less volatility. But, in recent times, Nifty is also very volatile.
So, bank nifty, heavy volatility and Nifty low volatility have been lost. But, if we take it as an average, Nifty is low volatile compared to bank nifty. But, financial services are safe but banks are the majority role.
So, it has more volatility than nifty and less volatile than bank nifty So, if you are able to handle volatility and want to increase it,
Now, let's talk about F&O trading. If you compare it with Fin nifty, Nifty takes higher margin. Whether you want to buy futures or sell options.
But in Fin nifty margin collected it less. But, you should also look at the contract size. If you multiply the present traded price by the lot size, you will get the contract size.
So, if you compare it with Fin nifty, the money they are asking us is reasonable. Similarly for Nifty also, lot size multiplied by the present traded value.
We should not think how much they are taking for bank nifty, Nifty and Fin nifty are less. We should not think compared to these two margin in fin nifty is less. we should look at the contract size and the percentage of money they are taking.
First, we should look at the amount of money they are charging. Now, let's talk about futures and options related to Fin nifty. If I want to buy Fin nifty Jan futures, I will have to pay Rs.1,02,000.
If I want to sell, I will have to pay Rs.1,01,000. What is the difference between the previous charges and the current charges? Here, we have Rs.75 as STT, which is security transaction tax.
When we buy, the charges are STT 0. Remaining charges will be changed in selling.
the average price for buying and selling is Rs.1,05,000. So, the amount charged for futures is also similar for options.
Present, Fin nifty is trading at Rs.18,796. So, the amount we will charged to buy and sell futures, We talked about this previously.
It will be Rs.94,000 depending upon the strike price. there will be a little variation depending on this. But, in and around, we need the money same as to buy and sell futures.
Simple. Fin nifty is a lot size 40. 160.85. If I had bought this, I would have needed this at Rs.6,400.
We learned how much money we will charged for futures and options. I will try to revise this once again. we can hedge and release our capital to reduce the amount we are getting.
For example, you wanted to sell 18,800 FI nifty call options. If you wanted to sell, you would have to buy 18,900, 19,000, 19,200,
Notice, I added buy here. the previous margin took from you would have been reduced significantly. Previously, you were asked Rs.95,000.
See, how much it is asking. It is 19,000. We can make multiple lots with this.
If we sell 18,800 and buy 18,900, 19,000, If I sell a cell for 40 and buy for 20, But, we would have spent 95,000 and trade a pair.
Now, we can take the remaining money and put multiple pairs. If you think you can't sell options with a small amount of money,
if you can understand these steps, you can practice option selling with a small amount of capital. Now, let's learn some more details related to Fin nifty.
We also learned the lot size. We have strikes in many places. I will google Nifty option chain.
you will see the option chain equity derivatives. Next, there is view options contract for. Select Fin nifty and you will see the option chain.
If you select the expiry, volume, open interest, writing build up, resistance,
you will understand if you see the option chain video. You can understand the resistance and support related to Fin nifty. whether it is in range bound or break out
People who want to trade, I will also share the option chain related views.
If you want to add support and resistance related to Fin nifty, I think there are not many people who are trading. If you want to know the important levels of trading,
I will also share the details in the news video and telegram group. It is around 18,800. we will have 18,550 calls in Nifty.
18,700 calls, like wise in this also we have 18,700 calls, 18,750 calls, 18,800 calls, 18,950 calls. We will have calls and puts available in the strike price range of 50-50.
They changed it may be due to liquidity or to make this like nifty When will Nifty and Bank nifty expire? We can see that Tuesday expiry.
So, you can see that Tuesday-Tuesday have increased the volatility in the bank nifty and financial stocks. So, those who trade in the bank nifty should be careful about Tuesday. the sudden moves in it,
The move in the second half will also impact the bank nifty. There is an overlap between the banks around 60%.
60% of their move, Fin nifty move, will also impact the bank nifty. I hope most of the knowledge related to Fin nifty came to you related to F&O.. I explained the regular income strategy along with the golden rules.
It also backtested both the banks in the nifty and the bank nifty. We can backtest the data using ALGOs and observe the probability, drawdown, and other metrics related to it.
We can backtest the rest of the data leaving slippages and human errors. It was launched in 2021. I am talking about the options contracts.
So, let's diversify Let's track them slowly. Let's see which one is more comfortable and which one has a better strike rate.
This will be the Tuesday expiry. the golden rules related strategy is for nifty and bank nifty.
But, as we observed in the recent months, the golden rules are working here as well. Don't follow the 20% strategy. Those who follow the 20% strategy,
if they move in a good direction, We will get a high return through that strategy. even if the market moves in a direction,
it will reverse and get a good return. It is difficult to get trapped once in first strategy. But, it is not like that.
If the market moves in a high volatile direction, Follow the 30% option selling strategy.
I am giving the link in the description and comment section. after making regular income videos, We have been keeping their paper trades and observations in social media platforms.
They are following the rules in the starting. Then, the market will become very volatile. They are taking big trades.
They are following the rules again. If you practice the golden rules for the entire year, If you practice for a few months,
it might take many days profit. Everyone will have the same impact. It will have the same impact for everyone.
In recent times, Nifty has moved from 4 weeks to 17,800 to 18,300. What is the situation of option buyers in recent times?
So, there will be some days for option sellers and some days for buyers. and as a buyer is to follow the metrics.
We should stick to certain rules. When you handle the worst day by following the rules, Tell us something to stabilize us.
Look at the net and capital you are saving. Until when you will get mental stability,
and the move related to it, how the index will move in which situations, What is wrong in that?
we will be stable in the market and learn everything. We can get some money and understand the observations in the market. we are starting far away.
We are bringing it closer. The market is in range bound. When there is a sudden move and we can't handle it.
Think of a target on the capital. 100 people will come to the stock market. So, everyone can't trade in the market in same manner.
After stabilizing yourself in the market, Don't bring the strike prices closer saying that the premiums decayed, you cannot handle the move. If you have any doubts or questions related to our option series or Fin Nifty,
please share them in the comment section. please share them in the comment section.
If you share your knowledge, If you just look at the questions and you leave, If we share one thing, someone will share something else
So, whenever you have questions, If you can answer the questions, So that it will be useful for everyone.
I hope you understood the efforts we make. If you want to support us further, and insurance related links are in the description and comment section.
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