BULLISH STRATEGIES
If we want to trade in F&O then, first we have to create A view.
A thread on strategies ๐งต๐งต
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If we want to trade in F&O then, first we have to create A view.
A thread on strategies ๐งต๐งต
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If our view is BULLISH then we can deploy following strategies
1โฃCall Buy
๐If our view is TOO BULLISH then we can simply buy a CALL option of ATM strike
๐Risk would be the premium we have paid and
Reward would be unlimited only If it goes above strike price + premium paid
1โฃCall Buy
๐If our view is TOO BULLISH then we can simply buy a CALL option of ATM strike
๐Risk would be the premium we have paid and
Reward would be unlimited only If it goes above strike price + premium paid
Consider below example:
You bought 17200 CE at 110, at expiry in order to be in profit.
Nifty has to stay above 17200 + your premium you paid 110 = 17310.
You bought 17200 CE at 110, at expiry in order to be in profit.
Nifty has to stay above 17200 + your premium you paid 110 = 17310.
2โฃBull Call Spread
๐Spreads are deployed when our view is NEUTRAL TO BULLISH
๐These are limited risk and limited reward strategies
๐In this spread, we use only calls to trade our bullish view
๐We buy a CALL option of ATM strike and SELL a CALL option above that strike.
๐Spreads are deployed when our view is NEUTRAL TO BULLISH
๐These are limited risk and limited reward strategies
๐In this spread, we use only calls to trade our bullish view
๐We buy a CALL option of ATM strike and SELL a CALL option above that strike.
๐Risk would be the premium debited and
Reward when ever it goes above SOLD STRIKE.
Example : You bought 17200 CE at 110
And sold 17350 at 51
So, 110 - 51 = 59๐
So you will be in profit if it stays above
17200 + 59 = 17259
Reward when ever it goes above SOLD STRIKE.
Example : You bought 17200 CE at 110
And sold 17350 at 51
So, 110 - 51 = 59๐
So you will be in profit if it stays above
17200 + 59 = 17259
3โฃBull Put Spread
๐In this spread, we use puts to trade with our bullish view
๐We sell a PUT option of the ATM strike and BUY a PUT option below that strike
๐Risk would be premium DEBITED and reward would be as long as the underlying trades above SOLD strike.
๐In this spread, we use puts to trade with our bullish view
๐We sell a PUT option of the ATM strike and BUY a PUT option below that strike
๐Risk would be premium DEBITED and reward would be as long as the underlying trades above SOLD strike.
Example: You sold 17200 put at 136๐
And bought 17050 at 75.85
136 -76 = 60
So breakeven is 17200 - 60 = 17140
You have to stay above 17140 in order to be in profit zone.
And bought 17050 at 75.85
136 -76 = 60
So breakeven is 17200 - 60 = 17140
You have to stay above 17140 in order to be in profit zone.
Hope you have understood how to trade in spreads.
You have to stick to conditions of market and execute it.
Do let me know in comment section what next you want to know more on trading with hedge.
So, that I will try to explain in simple words with example๐
You have to stick to conditions of market and execute it.
Do let me know in comment section what next you want to know more on trading with hedge.
So, that I will try to explain in simple words with example๐
You can compare each one ๐
Call Buy Vs Bull Call Spread Vs Bull Put Spread
Call Buy Vs Bull Call Spread Vs Bull Put Spread
You can join the telegram through the link below ๐
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