Investor Choices

Market Looks Like Volatile ? Manage your risk with proper strategies. Want to trade in the volatile market with proper risk management? When we talk about risk management then suddenly it clicks with options strategies. And out of so many strategies available for options trading we will discuss here two popular strategies for options trading i.e Straddle and strangle let us understand how these strategies work in a practical way.  Assumed, CMP of  Index 2,700 for both the cases. 1) Straddle : To form the straddle strategy we need to buy a call and buy a put with the strike price near to CMP. Here trader expects that there is some big news or an event but not sure which side the market will move hence he prefers this strategy. Eg: Annual Budget, Financial policy reforms, Government election results, Government policy reforms etc.  Formation: Strike Price 2,600 Buy Call @137.6 Buy Put @ 46.85 With the same strike price which is nearby CMP. See how your pay off w...

Butterfly spread ! Market Looks Like Sideways ? Want to trade but with proper risk management. Before an application of butterfly spread you must have a market view as non-volatile. Yes my friend it only works in non-volatile markets.   How to apply practically in the market.?? Which Strike price is required to select ? Let's understand, Many times we see different-different opinions in news channels and on social media that the market will be bullish from there or the market will be bearish from there but if you have understood the market behaviour you will be able to draw your own opinion. And if your opinion is sideways than you are the perfect one who can get benefit from this strategy. For Example: Company A CMP: 2700 Formation: Buy - Cash Outflow Sell - Cash Inflow Major condition : Choose strike price only on the basis of uniformity i.e difference between each strike price should be equal in this case i have taken the difference of 300. You can take 100, 200, or 30...