SBIN STRANGLE UPDATE:BOOK PROFIT IN SBIN 2150 PUT NEAR 75-77 HOLD 2400 CALL-
Monday, 29 April 2013
Saturday, 27 April 2013
The call backspread (reverse call ratio spread) is a bullish strategy in options trading that involves selling a number of call options and buying more call options of the same underlying stock and expiration date at a higher strike price. It is an unlimited profit, limited risk options trading strategy that is taken when the options trader thinks that the underlying stock will experience significant upside movement in the near term....
Tuesday, 23 April 2013
If combine this with the fact that inflation reduces the value of money over time, you are just loosing money if you do not invest wisely without understanding brokerage and inflation. A stockbroker earns a commission on whatever transaction you make. Suppose you make a transaction of Rs.2000, and the stockbroker charges you a 3% commission, then you have to pay the stockbroker Rs.60 for the transaction. So your total investment in the transaction in not Rs.2000. The total investment in the transaction is Rs.2060/-Brokers make money on whatever transaction you make. Whether you buy or sell, brokers will make money. Because brokers basically make money on transactions.....
Wednesday, 17 April 2013
BULL CALL SPREAD
For bullish investors who want a nice low risk, limited return strategy without buying or selling the underlying stock, bull call spreads are a great alternative. The bull call spread involves buying and selling the same number of call options at different strike prices.
BULL PUT SPREAD
For bullish investors who want a nice low risk, limited return strategy, bull put spreads are another alternative. The bull put spread involves buying and selling the same number of put options at different strike prices.....
Tuesday, 16 April 2013
Tuesday, 9 April 2013
A short strangle gives the obligation to buy the stock at strike price A and the obligation to sell the stock at strike price B if the options are assigned. You are predicting the stock price will remain somewhere between strike A and strike B, and the options you sell will expire worthless.
By selling two options, significantly increase the income you would have achieved from selling a put or a call alone. But that comes at a cost. There is unlimited risk on the upside and substantial down. This strategy is only for the most advanced traders who like to live dangerously .
There are two break-even points:
· Strike A minus the net credit received.
· Strike B plus the net credit received.
PROFITS AND LOSSES IN THE STRATEGY:....
Wednesday, 3 April 2013
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Let’s go with an example, to understand better how profits and losses are calculated in . The lot size of is 50 in number irrespective of . The profit/loss does not depend on the type of call , expiry or . It directly depends only on which trader selects while purchasing the option....