Here is the detailed information of about strategy,

Entry time : 9.30 - 10
Exit : Upto you

Strategy :
Sell weekly ATM CE & PE at almost equal price
For ex : Sell Nifty 17250 CE at 50 and Nifty 17250 PE at 48 so it will become short straddle

Buy monthly ATM or near ATM CE & PE at matching price (5-10 points diff should be fine) as hedge
For ex : Buy Nifty 17250 CE at 150 and Nifty 17300 PE at 155 so it will become long straddle.

Weekly Short straddle + Monthly Long straddle

Adjustment:

• If you feel slightly bullish/bearish then no adjustment needed
• If Nifty moves 50 up or down and sustain then just simply roll up or down half of qnty and keep rest of the quantity. If market goes up or down further then roll up or down rest.

• If Nifty moves one side or about to breach BEP then add equal amount of lot. This can balance tested side. For ex: If I bought 17300 CE 4 lot as hedge then add 4 lot so you will have only one side risk . Note: Remember to keep SL at cost price (only for additional lot bought)

Capital requirement:
2.2 L for 4 lot
Adjustment requires additional capital upto 1L

Note : High risk high reward strategy, please don’t execute until you fully understand. Kindly do paper trading or backtest.
RR : 1:1
POP : 45-55%

Straddles Vs Strangles – A Thread
There have been some really interesting discussion points recently based on Euan Sinclair’s assessment of RR in straddles vs strangles. Personally, I’ve always felt far more comfortable trading strangles. (1/n)

Straddles have the highest theta value and benefits more than strangles when there is a vol crush. Over time, straddles should have a net P/L greater than strangles. This, albeit, comes at the cost of a lower PoP and higher risk. (2/n)

Early in the expiry, rate of decay of OTM>ATM options. ATM options are in the middle of the bell curve and bulk of decay happens in the later stages. However, a 20% vol crush in a straddle may result in P/L greater than 100% of a 16 Delta strangle credit. Hence, (3/n)

Strangles are a vol+decay play, straddles are a far superior pure vol play. If one’s thesis is an exaggerated stock reaction, excessive implied volatility and lower Rvol going forward, it makes much more sense to narrow short strikes. You get paid more for the same PoP (4/n)

Straddles also make more sense to deploy in very small priced underlyings, where the straddle break-evens are very close to that of strangles. Might as well collect the higher credit. (5/n)

AN ESSENTIAL THREAD ON OPTION ADJUSTMENTS

Adjustments can be done in variety of ways & depends totally at the discretion of the trader. To get a clear mind we need to know the following:

1) What to follow,
2) How to make the adjustment,
3) When to make the adjustment. (1/5)

1) We need a way to measure the imbalance created by a delta move in an option strategy. We can measure through premiums, distance from index or delta of greeks (i personally use delta). So basically whatever way of measure we use, both sides should be equal in it. (2/5)

2) Adjustment can either be done by selling extra quantity of profitable side, buying the quantity of losing side or shifting both the sides. I personally shift the sides because with extra quantities our Gamma gets imbalanced & the risk increases if market reverses. (3/5)

3) While the first 2pts are objective, when to make an adjustment is totally subjective. It can be fine tuned through experience. It also depends upon what strategy u are using. For a short strangle the adjustment required is faster than a ratio spread or an IC. (4/5)

Straddle/strangle require faster adjustments because they are more vulnerable to delta or IV spike. Any other strategies like ratio spreads, ironfly, butterfly have some bought option, which can negate the spikes for a while. So we need a defined system as to WHEN to adjust.(5/n)

#Quora Question - What is the best “I QUIT” moment you have ever witnessed an employee do?

I along with my assistant resigned in the best way I remember. It is no secret that I lost heavily in #Nifty #BankNifty and futures in whole during 2009. I decided to do MBA in finance 1/n

Like that would have helped. By the time I completed MBA, I was broke. In the hopes of a good job and having faced life realities, I did my MBA with utmost sincerity. Up for marketing jobs. Best in communication skills. Ready to relocate and learn new things. I was placed at 2/n

A package of 18 lakh per annum in a Singapore based company. It was huge for me. Suddenly dreams coming true. Turned out, this was a period of fake placements in Punjab. It turned out to be a fake placement. College management realized their mistake and tried to placate me. 3/n

They offered me a meagre package of 3.6 lpa in marketing. I had to take it as it was best available. Being placed at 18 lpa, I was not allowed to take part in interview of other companies. I tried working smart and hard, but when you work for companies run by lala's 4/n

And no professionalism, you get fake promises. I kept slogging at 30k per month which was 3 months delayed and also kept #BackTesting in #OptionsTrading. For 4+ years I kept asking for promotions but always the fake promises. In Feb 2017, me and my assistant were sitting 5/n

Thread on T+0 line

What is (t+0 line) BLUE LINE in your payoff tells about your system?

1) FALLING LINE:

If you are t+0 line is falling down , you may lose money if the market moves unidirectional.

good breakevens

High theta decay

Moderate Delta

Example: IRON FLY

2) RISING LINE:

If you are t+0 line is rising up , you may lose money if the market is sideways .

very poor breakevens.

Zero theta decay

High delta

Example: LONG STRADDLE

3) FLAT LINE: ( my personal set up)

If you are t+0 line is flatten , you may not lose in any the market situation till some extent.

Decent breakevens

Moderate Theta decay

Very low Delta

Example: PROTECTED IRON FLY

4) STEEP DOWNFALL:

If you are t+0 line is falling too steep , you may lose in unidirectional move.

Brilliant breakevens

High Theta decay

High Delta

Example: SHORT STRADDLE

Most common question I get on twitter is how you manage Job📇 and Trading 📊
I have tried to answer with below thread,hope it motivates few to manage important things in life.

1. I love my Job and stock market is my hobby
2. I have 2 phones and on my main phone I don't have any social media app except office email ,other phone is for using WhatsApp and Twitter which I use for dedicated time and most of the time kept away.

3. I don't have TV📺 in my home and haven't watched the same for couple of years now.
4. I am not active on any other social media like FB,Insta as I don't have any interest in other people's life or other person's photo.

5.For trading📊 I only use one laptop,no extra screen .
6.For any type of learning I mostly read books on Kindle or search on internet rarely use YouTube as it can divert you and waste your time.

7.I have never subscribed to Netflix📺 or Amazon prime.
Didn't watch any movies or webseries from last couple of years except Harshad Mehta webseries as it was related to stock market.

My previous b'day which fell on expiry day was in 2010. On that day Nifty straddle opened at 45. Day range of nifty was around 30pts :)

(High 5415, Low 5380)

At that time:

•Didn't know the word Straddle though i used to trade them regularly
•Greeks existence wasn't known

•Adjustments felt like a superpower
•Everyday theta decay was a birth right
•Any strategy thought off felt like a personal invention
•Listening to people warning about unlimited loss in option selling was normal
•Making unlimited gain in long straddle seemed a possibility

•Volumes & Oi were closely tracked
•Overnight positions without hedge was a normal routine

All the above points have been changed over the years. But the underlying market psychology & following the price action still remains the same.

Thank you all for the warm wishes 🙏

I keep getting asked about what books to read to learn about Options. My compilation

Beginners Options Books:

1) The Bible of Options Strategies - Guy Cohen
2) The Financial Times Guide to Options - Lenny Jordan
3) Simple Options Trading Formulas - Billy Williams

Books on Options Greeks:

1) Trading Options Greeks - Dan Passarelli
2) How to Calculate Options Prices & their Greeks - Pierino Ursone

Books on Options Volatility Trading:

1) Option Volatility & Pricing - Sheldon Natenberg
2) Option Trading: Pricing & Volatility Strategies & Techniques - Euan Sinclair
3) The Volatility Smile - Derman & Miller

Books on Options Trading:

1) Trading Options At Expiration - Jeff Augen
2) Options as a Strategic Investment - Lawrence Williams
3) Positional Options Trading - Euan Sinclair
4) Options Spread Strategies - Tony Saliba
5) Options Strategies for Directionless Markets - Tony Saliba

Other important Options Books:

1) Options, Futures & other Derivatives - John Hull
2) Options Trading Strategies - Scott Danes
3) Covered Call for Beginners - Freeman Publications

The Straddle is my favorite trade these days. But more often than not, one needs to adjust to make a good return from it. There are many ways to do this depending on your view, psychology and imagination. Will discuss a few that I use

The Straddle is a delta neutral strategy and it is important to keep deltas in check during the course of the Trade and not let them run away from you. Of course Volatility is the elephant in the room- but not going there as that will require a separate discussion

The first and most common method is to go 'inverted.' That is to say to shift the untested side to generate additional Premium and increase the runway to Breakeven. So if you start with a Straddle at 700 and price goes to 740, you can move the PE up to say 720.

How much should you move the untested side? While again this is a matter of skill, experience and artistry, the rule of thumb is to cut deltas by half. Remember, prices will move and you have to allow sufficient room for them to fluctuate

The second method is to shift the entire Straddle in the direction of the move. So if you have a 700 Straddle and Price goes to 740, you can shift the Straddle to 720. If you time this right, it can generally be done at virtually no cost or minimal cost.

Process to read Charts of Banknifty for Intraday trading to plan trades & identify direction based on the price auction

A small thread

Retweet to reach maximum traders
@Mitesh_Engr @ITRADE191 @ProdigalTrader @AdityaTodmal @Puretechnicals9 @hjyadav @Singh7575 @Rishikesh_ADX

Timeframe used will be 5 minutes and reference level by using simple Previous Day High/Low , Daily pivot points level from daily chart (if any) , Multi day High/Low (if any)

To understand who is in control buyers or sellers making a split analysis of every 1 hour timespan.

Let's start with first 1 hour Stage 1

Stage 2

A thread about STBT options selling,

The purpose is simple to capture overnight theta decay,

Generally, ppl sell ATM straddle with hedge or sell naked options,

But I am using Today’s price action for selling options in STBT,

(1/n)

Its work on both index (Nifty, BNF) as well some standard stock but i used only for Index on every day and Last 10 days monthly expiry i do in stocks only specific,

It’s purely STBT type’s trade sell today and buy tomorrow kind,

(2/n)

Let’s start the strategy,

Every day at 3:15 PM, Open Nifty or BNF chart in daily TF.

See the last candle formation only; we take trade always based on the last candle formation

(3/n)

Case 1:
If Red Bearish candle formation, Mark the high and low of that candle

High 35979, Low 35667. (16th July)

Based on this candle we simply sell credit call spared (Sell 36000 CE and Buy 36300CE) you can make the difference between two calls 300 or 400 as per your risk,

Case 2:
Bullish strong candle

High 35238 and low 34922 (5th July) (Refer the image)

Based on this candle we sell credit put spread (Sell 34900 Put and buy 34600 put)

Catch me if you can @Mitesh_Engr

Time for a🧵
Mitesh Sir's EXPIRY Option Selling 101:
• What to look for?
• Strike Selection & Ratios
• SL mgmt
• Avoiding freezes
• Monthy Expiry
• Event days
• How he would have traded last expiry?

In collaboration with @AdityaTodmal

Edward de Bono says intelligence is like a🚗 Automobile

“A powerful car may be driven badly. A less powerful car may be driven well. The skill of the car driver determines how the power of the car is used.”

What @Mitesh_Engr Sir looks at for Expiry Trading:

• Technicals of BNF
• Individual Heavyweight stocks of BNF
• Support/Resistance of BNF on weekly TF
• Also has Superb SL management
• When it comes to adjustments, he is always on toes

How to Select Strikes to Sell?

• You can't sell based on premium
• Follow only trend
• Price action is best to sell on expiry day
• Never wait for the options to go to zero

Using Ratios to Sell:

• If BNF is in a range then strangles
• If breakout/ breakdown from a range then directional
• Selling 70/30 or 80/20 ratios
• 2 examples on how he used ratios

A Thread on the Boss himself @Mitesh_Engr

Mitesh Sir's Positional Option Selling 101:

• How to find direction
• Which options to sell
• How to deploy capital
• Exit criteria
• What ROI he targets weekly
• What % risk he takes

Done with the help of @niki_poojary

How @Mitesh_Engr Sir finds the direction?

• Daily charts S/R
• 75 min charts S/R
• Intraday trend
• Always play directional
• Never trades in strategies

Which options to sell in weekly expiry according to @Mitesh_Engr?

• Weekly candle High/Low
• Sell 1% away options from those
• Exit when levels breached

Position Sizing by @Mitesh_Engr Sir.

How to deploy your capital?

• First sell 20%
• Pyramid the next day
• When to exit
• What to do when view goes wrong
• What to do with idle capital

Some important tweets of @Mitesh_Engr Sir

• What Data to look at
• ROI for safe players per month
• Max risk per day
• Gather knowledge and play directional
• Never play strategies