BC OPTIONSLEARNINGS

Sarang Sood
@SarangSood 5 years, 2 months ago 1041 views

Low VIX doesn't necessarily mean ideal time for option buyers. If premiums aren't falling consistently during the day in low VIX, it usually gives those small delta & IV spikes, just enough to irritate both option buyers & sellers. Same happens when VIX is ultra high.

@SarangSood Sarang bhai according to you what number of vix is ideal for option buyers and what is that for option sellers? And is there any common number which is ideal for both?
— Dhaval bhatt (@Dhavalb55011726) July 14, 2021

More from Sarang Sood

Sarang Sood
@SarangSood

A THREAD

Topic: HOW TO TRADE IN RISING PREMIUMS SCENARIO

Option sellers specially Straddle sellers feel that rising premiums give them excellent opportunity to make easy money. So what they are seeing is the theta aspect of options & ignoring the delta/gamma/vega forces.

1/

With rising premiums come high delta moves. There is a reason why premiums are all increasing up in the first place. High uncertainty & fear is what's controlling the markets during such times. So a volatile 200 point move in nifty is always on the cards.

2/

Adjusting during such delta moves involves high slippages. Such costs go in our system & are irrecoverable. So if the ATM straddle is around 400 & after 200 point downmove, the next straddle is at 450 & the loss is not just 50points but compounded much more.

3/

Also there are chances that there is no decay throughout the day. So a straddle seller has to take that heavy risk of carrying it forward & chances of gap openings are high during such times. If converted into Ironfly, then the cost of the wings is too expensive.

4/

Thus cutting down the initial credit significantly.

There will also be very few instances when premiums don't fall till expiry day. So with each delta move the cost of holding a straddle gets accumulated & pressure keeps mounting for the stubborn option sellers.

5/

Sarang Sood
@SarangSood

Since IRONFLY is the flavour these days, sharing my own thread. It has GREEKS incorporated which automatically reduces wing size & risk.

P.S. No one specifically invented ironfly & it's adjustments. A good trader can figure it out on his own. I've been doing it on & off for yrs.

THREAD ON IRONFLY

These days the most preferred strategy for option sellers due to improved margins is IRONFLY. It's essentially a short straddle with long strangle. Long strangle acting as 'WINGS', which help in capping the unlimited risk associated with a short straddle.(1/n)
— Sarang Sood (@SarangSood) December 12, 2020

Sarang Sood
@SarangSood

A THREAD

Topic: Why triple straddle has no real benefit.

A triple straddle is essentially an ATM Straddle & one or two step away straddle on either side. The position is almost neutral strategy just like any other neutral straddle or strangle.

1/

We can also view the position as an ATM straddle, a strangle & inverted strangle.

For example

Nifty: 14700

Triple straddle: 14600,14700,14800

Another view:

14700 straddle
14800-14600: strangle
14600-14800: Inverted strangle

2/

So the real question is what is the advantage of an inverted strangle over it's otm counterpart?

The answer is none.

They both have same premiums/theta. Only that slippages will be high in inverted strangle when we do the required adjustments plus liquidity issue.

3/

So isn't it better that instead of a triple straddle, we can just do ATM Straddle & 2* OTM strangle.

So in the above eg. the position will be

14700 ATM straddle
2* 14800-14600 otm strangle.

Same premium received, similar range just that there's no nuisance of ITM options.

4/

The question arises:

Why trade in an ATM straddle & 2* OTM Strangles? Why over-complicate?

Options are in itself a complicated instrument. Wouldn't it be better to stick to one straddle or a strangle & adjust accordingly?

Lesser the strikes, more there will be clarity.

5/

Sarang Sood
@SarangSood

Q: Sir why call option premiums are higher the put?

A: It usually happens when there is big difference between spot & future.

Example

BN Spot: 35110
BN Future: 35300
BN Synthetic Future: 35150

It depends on our perception of what is ATM & accordingly match the calls & puts.

Sarang Sood
@SarangSood

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)

More from Optionslearnings

itrade(DJ)
@ITRADE191

For your understanding https://t.co/U89feuPEhC

Today morning I was bullish looking at SGX Nifty. The first put I sold was 14000 PE.

After that market took resistance at R2, then I changed my view. Sold 14650 CE and then even uptill 14300 CE. pic.twitter.com/Bo4La6kJRe
— itrade(DJ) (@ITRADE191) April 20, 2021

ANKY
@ANKYIIMR

All important Options Selling Strategies..
A thread🧵:

Simple Directional Call Sell

View: Neutral to bearish
Limited Profit, unlimited risk.
High Probability of profit.
High Margin required.

Simple Directional Put Sell

View: Neutral to Bullish
Limited Profit, unlimited risk.
High Probability of profit.
High Margin required.

Call Credit Spread

View: Neutral to bearish
Limited Profit, Limited risk.
High Probability of profit.
Low Margin required.

Put Credit Spread

View: Neutral to Bullish
Limited Profit, Limited risk.
High Probability of profit.
Low Margin required.

itrade(DJ)
@ITRADE191

NIFTY TRADE

Aditya Todmal
@AdityaTodmal

DJ SIR THREAD

Great video with points helpful for beginners.

Made 4 threads on DJ Sir with the help of @niki_poojary

1. Selecting strikes to trade in with risk management.
2. How he took some aggressive trades.
3. Multiple charts analysis for intraday trading.
4. Trade Setup

https://t.co/Ngoc5bh906 Thank Mahek bhai for making this video basis my set up which i have been following since past 2 yr I\u2019m not promoting this software, neither I 'll gain any referral if anyone subscribes for this software ,Purpose is to share help fellow traders!\U0001f60a
— itrade(DJ) (@ITRADE191) September 5, 2021

Attaching all threads made on DJ Sir. After watching the video you can refer to this tweet for notes about his strategy and learn a few other ideas.

Compiling these together for easy access to his knowledge.

1. Selecting strikes and risk

5. A THREAD on . . . .

How @ITRADE191 selects strikes to trade in and how he follows risk management.

Short thread explained via pictures with the help of @niki_poojary.https://t.co/YiYYaIReNS
— Aditya Todmal (@AdityaTodmal) July 11, 2021

2. Going aggressive with help of data and

6. Thread on how @ITRADE191 made 3 lakhs in 2 days.

You will need:
1. Pivots
2. Vwap
3. PDL/PDH (Previous day high/low)
4. Advance/Decline Ratio.https://t.co/o9tLOaLpEh
— Aditya Todmal (@AdityaTodmal) July 11, 2021

3. Intraday

7. DJ @ITRADE191 multiple chart analysis for INTRADAY TRADING.

1. Core setup
2. Pivot points trades
3. PDH/PDL trades
4. Open interest addictions combined with rejections on charts.
5. Website to confirm biashttps://t.co/qZQCWOSisa
— Aditya Todmal (@AdityaTodmal) July 11, 2021

Sheetal Rijhwani
@RijhwaniSheetal

If you are new to F&O, you can start with Vertical Spreads (Debit and Credit spreads) instead of buying options in Stocks and Indices.
Here are some ways how you can do it, when you can do it and the right position sizing for doing it... 🧵 (1/25)

Traders who are trading in cash and want to explore options generally start with options buying without much knowledge. They buy OTM strikes and trade with wrong position sizing. With no idea about the perfect entry, they end up feeling that F&O is risky. (2/25)

After losses in F&O buying, this is how I approached it and it rewarded me pretty well in initial phase. I find this strategy easy to start things off. And then, you can explore other strategies too and find what works for you. (3/25)

Vertical spread is a directional, defined risk options trading strategy:
1. Bull call spread (Debit spread)
2. Bull put spread (Credit spread)
3. Bear call spread (Credit spread)
4. Bear put spread (Debit spread)

Read about these strategies in the below articles. (4/25)

https://t.co/KQvYOsu9kv

While going through these strategies, you must have thought you have to wait till expiry for profits/loss. (5/25)

Asuras grew angry at the Devas for taking advantage of their King's virtuous behaviour and invaded the heavens. The Devas, afraid of the Asuras, enlisted the help of human Kings such as Yayati, Raji and Kakutstha and defeated them.

Prahlada attacked the gods and defeated Indra in battle, forcing the King of the Gods to run for his life. Indra sought help of Lord Vishnu. Infused with his power, Indra defeated Prahlada. The latter understood that Vishnu was helping Indra in battle and he withdrew his forces.

Prahlada first gave his kingdom to Andhaka, but the latter was defeated by Shiva. So Prahlada gave it to his son Virochana and undertook a Tirtha Yatra.

asif
@aj_raja

PAKISTAN-INDIA WATER ISSUES – HOW INDIA STOPPED WATER IN PAKISTAN's CANALS IN 1948

Thread

After partition in 1947, the water system was also bifurcated between Pakistan n India.

India cheated Pakistan when on April 1, 1948, India suddenly n without warning stopped...
1/n

...the supply of waters flowing into Pakistan's Central Bari Doab and Dipalpur Canals.

The boundary award on the partition of the sub-continent had left the headworks of these canals in Indian territory, and in accepting it India had implied her willingness to leave...

2/n

...the historic distribution of common waters undisturbed.

India's action was therefore in flagrant disregard not only of international law n morality, but of her solemn commitments with Pakistan and a gross violation of this country's historical rights over common waters.

3/n

Faced with a threat of utter desolation of millions of acres of fertile land, Pakistan had perforce to sign a document with India in which she agreed to "India's progressively diminishing water supplies to these canals and to the West Punjab government's tapping...

4/n

...alternative resources".

A specific reservation was made in the document with regard to India's claim that she had full property rights over waters flowing into her territory, and could therefore use them as she liked.

The issue was, however, to be examined...

5/n

SK
@sk_diary1

#DoYouKnow -The place where
Lalitha Sahasranamam -1000 names of Devi originated.

It is in Lalithambigai temple -Thirumeeyachur,Near Mayiladuthurai,TN

There is a Legend #story & it is related to this beautiful #sculpture of Kshetrapuraneswarar & Ambal Lalithambigai #Thread 👇

#Legend #story
It is believed that this is birth place of Kashyapa Maharishi’s sons, Arunan& Garudan. Arunan(charioteer of Surya)was physically handicapped.He was a Shiva devotee.Arunan wanted to visit Kailash to have Shiva Darshan,but Surya Dev denied permission.

So Arunan disguised as a girl & was on his way to Kailash.On the way Surya Dev saw this girl & outraged her modesty.Shiva was very angry with Suryan for misbehaviour & cursed him to get darkened. Whole world plunged into darkness.Surya Dev pleaded to Bhagwan Shiv to forgive him.

Shiva Bhagwan asked him to go to Thirumiyachur & worship him there. As advised, Surya Dev performed rigorous penance, placed murthi of Shiva& Parvathy on an elephant & took them to the clouds.Shiva in this temple is known as Meganathaswamy,Devi is known as Lalithambigai

Even after severe penance,Shiva does appear,so Surya Dev cries out in agony.Disturbed by his call, Parvathy protests.Siva pacifies her & offers relief to Surya Dev.The sculpture of Shiva pacifying Ambal shows her sullen from one angle &smiling from another.

$(\u3063\u25d4\u25e1\u25d4)\u3063 \U0001f499 \U0001d440\U0001d4b6rymo Belfast \U0001f499\U0001f331\U0001f340 \u24cb\U0001f397\ufe0f$

(っ◔◡◔)っ 💙 𝑀𝒶rymo Belfa...
@MarymoBelfast

THREAD PART 1.

On Sunday 21st June, 14 year old Noah Donohoe left his home to meet his friends at Cave Hill Belfast to study for school. #RememberMyNoah💙

He was on his black Apollo mountain bike, fully dressed, wearing a helmet and carrying a backpack containing his laptop and 2 books with his name on them. He also had his mobile phone with him.

On the 27th of June. Noah's naked body was sadly discovered 950m inside a storm drain, between access points. This storm drain was accessible through an area completely unfamiliar to him, behind houses at Northwood Road. https://t.co/bpz3Rmc0wq

"Noah's body was found by specially trained police officers between two drain access points within a section of the tunnel running under the Translink access road," said Mr McCrisken."

Noah's bike was also found near a house, behind a car, in the same area. It had been there for more than 24 hours before a member of public who lived in the street said she read reports of a missing child and checked the bike and phoned the police.

SK
@sk_diary1

Prasanna Venkatesa Perumal #temple -Gunaseelam,Near Trichy,TN #Thread

Gunaseela Mahatmyam,a chapter of Bhavishyottara Purana describes greatness of this place.

Venkatachlapathi of Tirumala Tirupati appeared b4 Gunaseela Rishi here,so Gunaseelam is known as Ten(South)Tirupati

Prasanna Venkatesa Perumal is in a standing posture with 4 arms holding sankha & chakra in the upper hands.The lower right hand is in abhaya pose,blessing devotees &left hand is in kati hasta,resting on waist.

A sceptre(senkkol)rests on right shoulder,with which this murti is believed to cure people affected by mental illness.These patient stay here for a period-48 days& participate in poojas&most of them get relieved of their problems.There is a temple run Mental Rehabilitation center

#storytimethread -As per Sthala Puranam,existence of this temple is due to efforts of Gunaseela Rishi, a disciple of Thalpiya Maharishi.
Thalpiya Maharishi along with his disciple Gunaseela Rishi once went to Himalayas.On his way back, Gunaseela Rishi stayed back at Tirupathi.

He was so wanted to have darshan of Venkatachalapathy in Gunaseelam near his asharam & bless the devotees.

He came back, bathed in the Cauvery,took blessing from his guru &undertook severe penance here in his ashram in Gunaseelam.

Low VIX doesn't necessarily mean ideal time for option buyers. If premiums aren't falling consistently during the day in low VIX, it usually gives those small delta & IV spikes, just enough to irritate both option buyers & sellers. Same happens when VIX is ultra high.

More from Sarang Sood

More from Optionslearnings

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