Here's the last 13 years of #BudgetSession Intraday chart, lets figure out what kind of Trading strategy one can use to make use of Budget movement. This is what happened with #Nifty on intraday time frame on the budget day from year 2008 to 2021.

Year 2008, 2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
As you can see from the above Nifty charts, the volatility is extremely high on the day of budget session making it very difficult for the intraday options players to make money. Its highly impossible to predict the direction on budget day.
If someone wanted to buy options much before the budget session, then the premiums becomes very high due to increase in IV, option buyers would not make much returns even if there is big move on budget day since the premium gets eroded once the event is over
But what I have observed with this last 13 years of data is, Market has moved in one side direction with huge trend once the budget session is over most of the time.
We need to make use of this huge trend post budget and also the IV drops after the budget event, hence when we enter the trade after the event option premium will be relatively lower. So I have back tested the Long Straddle strategy for last 13 years.
Rules: Buy ATM Call and Put options (Monthly expiry) near day end on budget day & hold it till expiry. The max risk is the premium that you pay, that’s all. Here’s the result.
https://t.co/eddF2jCDx1
The total returns is more than 300%, however in 2013 the market did not move much which resulted in loss of -85%. So invest only the money you can afford to lose in this strategy, but the risk reward ratio is much higher. The key is enter the trade when budget session is over.
Here's result for 2018
Here's the result for 2019
Year 2020 result
10 out of 13 times this strategy has given positive returns in last 13 years. Here's the link to blog post https://t.co/jLymp48GTG

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