Hi, Your thread is ready to read. Option selling strategy thread 🧵*Capital must be above 6lac*Target only banknifty (weekly expiry)* T https://t.co/lPLskzeKTX
Have a good day!

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)

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.

@jigspatel1988 @buzz_chronicles STBT

I have taken 4000+ trades in the past 3 years as an Option Seller.

Here are the 11 mistakes I've made in my journey, that you desperately need to avoid: 🧵

Collaborated with @AdityaTodmal

1/ Level-Based Trading on non-expiry days:

On expiry days all OTM options are going to go to zero, so you can take a bet on a particular level for a high reward.

But on the other days, the spikes are just too much, especially in this low-Vix environment.