Modified Short Strangle Strategy Explained

[00:00] Actually, I didn't come here to tell you about the concepts or the important strategy. in the comment section of our video, If you take that Strangle,

[00:16] how to get a 10% premium, Means, mostly in recent times, Not the video, but the theme we think will fail in that video.

[00:29] we thought of making a 30% intraday, right? They are not saying that it will fail. They are asking what is the fourth and fifth.

[00:44] I want to give you some important suggestions. I want to give you important suggestions related to this. since I told you about the support and resistance concept in the second channel,

[00:59] I have shown you live trades too. I will show you the market once again, we drew this line as resistance.

[01:15] Actually, the market faced resistance at the same line previously. But what happened in the third time, I drew another line there.

[01:28] So, mostly for those who are watching news videos, I keep repeating it repeatedly until the view changes. which level below or above,

[01:43] I want to give some clarity related to this too. the topic we are talking about now, In recent times, volatility is very heavy.

[01:58] If 200 points fall in 15 minutes, And what are the conditions? I want to cover this topic too.

[02:10] Actually, I wanted to ask you the Q&A. For currency too, I thought of asking you the Q&A related to equity series, F&O series.

[02:25] taking all the questions and sorting them out. But, how is it? Maybe I am not giving you the likes.

[02:40] we have our official YouTube account in the system. So, I will be looking at all the comments when I am on my way to the batminton or on my bike.

[02:55] the comments that I see a lot, like, why did you say this in the recent times, how the left-hand triangle is becoming a straddle,

[03:09] a directional trade, It works, but you said 4th and 5th too, right? And, when you ask me conceptually,

[03:22] We never talked about it in recent times. After this video, I said, if we don't have any questions,

[03:36] If you have questions, because not everyone should watch this video. will also post their questions.

[03:49] and if I comment, I will see every comment. Or, if I miss it,

[04:02] Are you FNO related or equity related? Friends, every time, When I do FNO, I focus on equity.

[04:15] valuation, etc. in my second channel. I will keep the majority of my time for investment videos.

[04:27] first clear all your questions here. if your questions, are good,

[04:40] you will definitely get the series video I planned. So, before ending this series, If you have the same doubt,

[04:52] Our series will end with the next videos. if you think our efforts related to this video are valuable, then definitely try to encourage the efforts we make by liking the video.

[05:07] Their content will be useful for us. instead of opening D-mat and trading accounts directly, whether you are opening accounts or using opened accounts,

[05:21] Okay, first, let's talk about our strangle. Because, what happens is, and we are making videos related to trading.

[05:33] If I have to say this in front of the video, the subscribers are saying that it is not working in recent times. Yes, in recent times,

[05:49] I will tell you the reason for that first. Actually, I made this video, on 20-21, May 22nd.

[06:01] Now, how much VIX is at 12-13. 10.17, 10.2. how much premium you have at that time,

[06:17] It is significantly lower. I have mentioned and explained about VIX in my videos multiple times. If premiums are high,

[06:33] the premiums you take will give you return. even if you take a long distance, if you select the strikes based on premium,

[06:46] I have mentioned that I have to select the premium with 100, If 120 is at this distance at that time, Is 20-21 only in May?

[07:01] What VIX is at that time, they will have a very good profit. even at 20 above,

[07:15] It was maintained till the end of September 2022. with the premiums we think, we see 3-4% weekly,

[07:28] I am getting stop loss sometimes, our strategy video worked out. in the comment section,

[07:43] from September 2022, In this situation, Friends, that is not the strategy we found.

[07:57] is not what we found. But, what we take credit for is, go far and sell,

[08:09] there is nothing we can do. they got stuck in the mind, when the AboM is moving by 50%,

[08:23] if we can balance according to the option premiums, It doesn't grow that much. So, the call on the upside will cool off,

[08:37] So, whoever is doing this strangle, there is an edge to follow the golden rules. Not now, after 20 years,

[08:52] if you take a profitable option seller, But, the way of adjustments will be different. In our years of experience,

[09:05] how we can sustain in the market, Not for that strategy. whether the VIX is less or more,

[09:19] you can use that strategy anywhere. we have to reduce our risk and reward. For that, you should not make strike selection as premium based.

[09:33] in how many Q1 days, expect a low return monthly. Even if you take 2% monthly,

[09:48] That is too much for us. when there were 20 VIX, I told you that it will not work out even if we have 10% monthly.

[10:01] Because VIX is less. there is cyclicality. When VIX grows a lot,

[10:14] you can expect 10%, 15%, even 20% return. bank rifty, you will get good returns.

[10:28] we will not get the premiums that are present. it will be risky. If there are 15 below VIX,

[10:41] If there are 15 below VIX, We will leave all our expectations. 1% in the least case,

[10:54] So, it will be 24 in a year. If we have the presence of If we go to brokerage,

[11:06] profitability to loss, if we come close and look for more returns, So, let's reduce the risk.

[11:20] How will I say? 2% in the best case. So, to sell a call and put,

[11:34] How much? to sell it. Now, let's go to the calculations.

[11:46] But, let's say it's Rs.50,000. Rs.3,000. to make a triangle on your monthly capital.

[12:00] at an yearly rate of 24-25%. We have 4 weeks. If we need Rs.750 per week,

[12:14] So, we need to select the premium Because, there are 2 call and put in it. Rs.375 from put,

[12:27] But, how much premium should we sell? You select 15 premium call and without any fear of losing money,

[12:45] If you try to take a buy position, And, significantly, the margin will also reduce. You can plan to get the benefit

[13:00] don't try to reduce the money, So, let's see where 15 premium is. 15 premium is at Rs.44,900.

[13:15] The market is at Rs.43,700. I'm asking the date of May 13th. Is there a probability?

[13:29] I think it's low. But, the probability is very low. compared with put,

[13:42] in a few days is not that high. The probability of going to Rs.44,000 is high. The probability of going from Rs.43,800 to Rs.43,500 is high.

[14:00] So, if you reduce the return, The premiums will increase so much these small premiums,

[14:12] Because, they keep coming down. Yes, it will move. But, in majority of cases,

[14:26] or if you are getting stuck, When VIX is less, If you take 1%,

[14:40] the market will go to the next level. and not touching the market. Whether you can adjust from the screen,

[14:52] you can do anything when you think you are a pro. I am telling you again. and think that VIX is less and there are no premiums,

[15:04] Did you see the high time? and went to almost 70. did the work get maintained at 30-40 levels?

[15:17] If you want to plan 25% monthly returns, I will tell you what happens here. You sold these premiums.

[15:29] But, it still expanded to out of the money. 39,000, 43,000. What will we do now?

[15:42] we are shifting our range along with the market. So, don't see the strangle as a strategy. I said this in that video too.

[15:55] But, our adjustments do the special thing. Only this will make us special. There is nothing wrong in it.

[16:07] There will be a chance of taking 10% returns monthly. But, don't plan it when it is 15 below. Work up is a risk reward.

[16:23] It is not a strategy. our success rate will increase according to our strategy. Even if you are trying some strategies,

[16:36] there will be a strategy in your mind. It is not a strategy. We thought that it will be like this in the market.

[16:49] Now, it is 15 below drastically. If we reduce the risk, They are coming to the market and

[17:02] You don't understand psychology. You will get excited if you get a loss or profit. You should know how to manage big loss.

[17:15] How was my internal mindset? We also face big losses. We will discuss that in a separate topic.

[17:28] We should deal with the market testing us and hurting us. What did you learn in the first market? You did paper trading.

[17:42] don't go with full capital. You won't get some topics in reality. I can trade with minimum capital.

[17:56] you can trade with just one stock. Did you see your question? But experience won't.

[18:08] Beginners, if you want to trade, If you want to trade, you can get profits instantly.

[18:21] test with very less capital. then increase the capital little by little. In the next 2-3 years,

[18:34] Understand the market dynamics. that 89% of the people will fail and only 11% will succeed, who endured all the market punches,

[18:49] They faced everything. Don't know how deep you are. you know what will happen.

[19:02] I hope you understood this triangle related. Now, when the WIX conditions are low. and you think you are getting good premiums,

[19:14] Or reduce the reward multiple times. So, If you take 1%,

[19:28] how much risk you will get when you go far. If I can do the same triangle monthly, the example I take is weekly.

[19:42] Or, How did you adjust? The premium will increase.

[19:54] You can go as far as you want. more time value, it has to decay.

[20:07] you may not see the decay as big. One will decay less. you may have a problem.

[20:19] My stop losses shouldn't come easily. I should be cool. you can go far.

[20:32] the range will increase. will get more range. I am showing you the date.

[20:46] This May is not the month end. let's take June month end. I will tell you clearly.

[20:59] 46,000 call. 46,500 call. How much money will it cost to take this?

[21:13] It will be around 1,20,000. If we want to execute this, Let's calculate the return on that entire capital.

[21:26] Because it will be easy to tell you if it is round off. net result for you, That may be for you brokerages and charges.

[21:39] We are thinking of 3000. we will select the premiums based on the return. Because I want to go to the brokerages and charges related to that.

[21:55] How much is 2% out of 1,50,000? we don't need to divide it by 4. we will get premium.

[22:08] We need 120 on both sides. we need 60 premium. Why did I select 100 premium?

[22:20] Let's say this is 100 too. Let's say both are 100. We will get 5000 rupees.

[22:32] To know, If we divide by 1.5, The return we expect is 3000 rupees.

[22:45] Almost 2.2% return. But we get only 1.2 lakh. But we have brokerages and charges.

[22:59] Not the return we get. 46500 on top. Before the end of June,

[23:12] How much is the probability? Just because we reduced the risk and reward. 1%.

[23:25] if we take all charges in consideration, If we compound that 1% yearly, I am telling you about the low VIX conditions.

[23:38] 1% or less than that. don't get exposed to high risk. nothing will happen.

[23:51] it will be reduced to 1%. Let's limit ourselves to that. That's why I calculated for weekly.

[24:03] I hope you understood the concept and risk reward theme. Let's say you expect 1% return monthly. If we expect 2% return,

[24:20] But we don't want to use that capital and money Like ETF related to Nifty,

[24:33] in debt instruments, Investing in these, your money won't be ideal.

[24:45] minimum 6% If you expect that, and if you can protect your capital,

[24:58] best returns will be created by your money. The return that comes in option selling We invest our money in other things,

[25:13] liquid funds. that we pledge. and the growth that comes from investment,

[25:26] Again, I am telling you, iron fly, don't come directly to the first market.

[25:38] and come to the market after you have and you are taking risks, then the market is not life.

[25:51] Even if you do business outside, tensions than you did in the market. Don't think that the market is the only thing.

[26:03] Leave it happily. ultimately, and a feeling that I am good in life.

[26:15] then you don't have to be there. We should see our family members to be healthy But if we take mental tensions

[26:27] then stock market trading is not good for you. If you have any other questions, We will answer in the next Q&A.

[26:40] They are small topics. So, I talked about 30% of it. They are saying that I didn't talk about 4th and 5th.

[26:52] get confused? Already, there are 2-3 puts or calls So, you have some left in the direction.

[27:05] the Banking Ft. move that we have, If we go beyond that, It will go beyond a level.

[27:17] How did you put the 3rd? in the video is that it is over risk. and all the calls are hit,

[27:29] for the market price. You might not adjust it for the market price. Stop loss will not go.

[27:41] Whenever you can, 4th and 5th. Go with your comfort or experience.

[27:56] Near week if you are getting why 30% straddles

[28:08] because the weeks are less in recent times, But, just think, 44500 calls

[28:21] 43800. It is 265. It comes to around 80.

[28:35] it comes to 120 or 123. we are in the middle of the month. and the contract

[28:47] your stop loss is getting triggered. My probability should be reduced. so easily.

[28:59] you can sell it monthly. I showed you the weekly in the strategy video. Why did I show it?

[29:11] Because you have to You will get a decay. The weekly that was put in the beginning

[29:23] there are chances that the weekly will become zero. It will be reduced. we put the decay after the gap up or gap down.

[29:38] Compared to the monthly. The more decay will always be in the weekly. They don't play in the monthly.

[29:52] But still, if you are not getting the comfort, The stop loss won't hit.

[30:06] You will always get a good profit in the monthly. They put the call and put. The weekly won't be small.

[30:19] These are all big premiums. Then, you will get a good profit. and if you put another straddle,

[30:31] it won't be the same every time. you will get a little frustration. to reduce the stop loss,

[30:43] You will think that it will be good in the weekly. So, every premium has its edges. It has its advantages and disadvantages.

[30:55] The probability is more, we will get money. the probability is less.

[31:08] But, if we go in the direction, we will get a good profit here itself. And, I told you about the fourth and fifth straddle.

[31:21] the fourth and fifth straddle, Because, you have to handle the first, After getting hit.

[31:33] Friends, if you are making on your chart. I will show you what you see.

[31:47] You go and check all the news videos. I am telling the market to be bullish Even in recent times,

[32:01] There was a significant downside. Even though there was an opening, below the point.

[32:13] So, when we have a bullish view, when we have a bullish view, The support went below

[32:27] and there was a selling opportunity. I will not look for a selling opportunity. the range,

[32:40] So, if you have a bullish view, You will look for a buying opportunity. the important level is above the sustain candle.

[32:53] Till the next candle closing or you should put the breakout candle below the stop loss. how many times have we done wrong?

[33:06] whichever candle you put above the stop loss, So, this is a loss case. Again, upside.

[33:19] If you want to take the second candle high, The stop loss did not hit us that day. Upside.

[33:31] if you are very big, I have told you in the live also. if we think that the resistance is near,

[33:43] this is a loss trade. This candle did not close. The resistance closed above.

[33:55] And, the target moved to the upside that day. you will think in only one direction. When will that view come?

[34:07] I am seeing the important levels. I am telling you constantly in the news videos. 18,180 and 18,240.

[34:20] 18,450. 19,000. These are the important levels in my mind resistance.

[34:33] I will have courage. I personally think that if you want to play directionally, you should keep the levels far away in your mind.

[34:47] I'm looking at 250 points below. Even if the level is above that, if you are bullish in the market, you should look for buying opportunities. If I say it's fake, it's a lot of times fake.

[35:02] But selling the market that fell, buying when it's growing, buying again when it's falling, selling again. If the first thing is lost, the money business will be lost from the market. If there is a direction, we should keep a view and then go in that direction.

[35:17] And friends, in news videos, it's difficult to say that I'm bullish. After saying that I'm bullish, if the market closes below the level I said,

[35:30] I will change personally. But when I say it to the public, they think I'm bullish and bearish.

[35:42] If it's going well, no one will comment negatively. In recent times, we thought it was bullish above 17,800. We don't have appreciation anywhere.

[35:54] I'm telling the beginners. Whatever I say in news videos, it's not to make you trade or sell the IR. I'm telling you this because I'm looking at the market from this view.

[36:08] I'm telling you that I'm bullish. How many times does the market try to trap us? If there are sellers, they will be trapped.

[36:20] It went down from the opening. The gap went down, the recovery went down, and it went down again. Let's say, the price is around 18,060.

[36:34] But what happened to the market overall? If you try to buy in the intraday, But here, it will be hit badly.

[36:48] I'm telling you my view because I'm looking at the market overall. But the main reason I'm telling you is, if they take a good sell position after the market falls,

[37:03] at least they will rethink it. If we share the view of a public channel to the public,

[37:17] we should take the negativity related to it. Someone is trading based on support and resistance. I'm telling you again, if I tell you, you won't take a trade.

[37:31] If I say bullish or bearish, you can't do anything. That's a view. you should plan the risk reward, support, resistance,

[37:44] and the size of the candle according to the level and stop loss. But if you go against the risk reward, you will earn money. but don't go against the risk reward.

[38:00] bullish bearish, this level, above, this level, Even if you think against me, Now the market has come to 18,300, it has increased so much.

[38:15] You are on the bearish side. But what do I do with my view? What do I do with that?

[38:28] You form your own view as you like. If you take what we say as a YouTube channel, So I think I understood.

[38:41] Friends, if you have any questions related to this Q&A, And I didn't want to make such lengthy videos. even if we are continuously touching the length,

[38:58] You can see trading videos too. Then why is it coming so far? Some people in the comments section say,

[39:10] But if you tell me the point, But the beginner won't understand. not to waste your time.

[39:24] with a time camera, light on my face. if I don't tell you that, So I'll look at the time lines too.

[39:38] So that you can skip to my main points if you want. If you didn't, please do it. Their content will be useful to us.

[39:52] Go directly to the websites. Instead of opening websites directly, We will provide services to everyone.

[40:06] We will provide it to everyone. use the links in the description and comments section. it will be beneficial for our channel too.

[40:20] the links will be in the description and comments section. Till then, take care. Jai Hind!