Thread: Free Options Trading Course for Beginners with small capital.

Reference: Option trading marathon series, part 1 from Mr. Subasish Pani ft. @PushkarRThakur

with @AdityaTodmal

1/ Trading journey of Mr. Pani

• He has an experience of 7 years.

• He has made a profit of Rs. 20 cr. over these years with a capital of Rs. 2 cr.

• However, it's not easy to make such profits.

• More difficult, is to retain those profits and build more on it.
2/ How he ventured to options selling

• He started with futures and option buying however after a certain point when his capital grew, he faced scalability issues and hence he resorted to options selling.
3/ Investing becomes imp once the capital grows:

• Since his trading profits have grown well, he has started investing (investing is always for LT).

• For folks who dnt have much info regarding investing can simply buy Nifty 50 stocks & keep rebalancing as Nifty 50 does.
4/ Covered calls strategy for the portfolio:

• Pledge the portfolio and receive margin ~80% which he would then use to sell OTM CEs of the stocks which are in his portfolio.

• This helps in generating fixed income from the portfolio.
5/ For folks who wish to learn trading, check this:

• Need to have a firm commitment.

• In terms of money and in terms of how much time you would give yourself in market.
6/ Start with a small capital:

• Lets say you start with Rs. 10k.

• Buy everyday one single stock exit with Rs. 300 loss and profit of Rs. 600 with position sizing.

• Do this exercise for 30 days.

• This is to understand the process.
7/ Stick to your set up

• Be disciplined

• Don't do system hopping

• Try to take atleast 100 trades to understand the nuances of the system, as develop discipline over the period.
8/ What is Call option (CE) & Put Option (PE)

• If your view is that market will go up, an option buyer will buy a CE and if the view is that market will go downside then an option buyer will buy a PE.

• Every option has a premium.
9/ Intervals in NF & BNF:

• Nifty option strikes has an interval of 50 points and Banknifty has 100 points.

• Check Option chain for more details:
- Nifty :
- Banknifty:
10/ When does an option buyer or a seller makes money?

• Buyer makes money if the market moves in his favor.

• Option sellers make money if the market remains sideways or moves in his favour.
11/ Basic set up for option sellers: Short Straddle

• Wherever the spot is sell both CE & PE of the same strike.

• Currently NF spot is at 17530, so to short a straddle one has to sell both 17550 CE & PE together.
12/ How to initiate a trade:

• Net premium collected is Rs. ~330

•Premium decay happens the most on Tuesday Wednesday and Thursday

• Trade this in intraday and avoid overnight risk while learning.

• Probability of this set up is 70%

• The R/R should be 1:2
13/ When to exit:

• Capital required for 2 lot of strangle is aprrox. 3 lacs

• Book out based on target or SL:
- SL: if the losses amount to Rs. 5,000 or
- Target: it if the strangle is in profit of Rs. 10,000.
14/ Don't go into adjustments:

• Especially when you are in learning phase.

• Also Subasish doesn't believe in adjusting the legs, its usually SL or target for him.
15/Don't get sad when you SL is taken out

• Take that as a learning, as you will exactly know how much point SL you need to keep.

• How does the option premium behaves towards the expiry etc.
16/ Option buying requires more discipline

• Although any trader requires discipline while entering and exiting trades however option buyers requires this virtue a lot more.

• An option buyer can make money only if he can time the momentum properly.
17/ Option buying Timing:

• Usually momentum is better from 9.15- 10.30am.

• 5min TF will have more trades than 15min.

• Select the TF as per your temperament.

• If one has slightly more capital then look for trades between 1.30-3.30pm.

• 10.30-12.30pm: No trading zone.
18/ Trading psychology & discipline in option buying:

• If you have booked losses in 3-4 trades in the morning hour then just close for the day.

• If you are in profit in the morning trade , then you can risk that profit and trade in the closing hour.
19/ When to buy?

• E.g. you are using 5min TF.

• If any candle breaks the first 5min high or low buy CE or PE accordingly.

• Eg: Market gives a BO of the first 5min candle basis which you buy a CE option, but thereafter before reaching your 1:2 target it makes a downmove.
20/ When to exit?

• Now exit the CE buy and buy a PE.

• If the market is in momentum then you'll be in profit.

• If your SL gets hit, then that's an indication that market is consolidating.

• If both the sides SL gets hits then better to close trading for the day.
21/ Best time for option buyers having small capital:

• Focus only on 9.15-10.30am everyday.

• Thursdays when there is weekly expiry focus on 1.30-3.30 pm as well, as a strong move towards the end of expiry can fetch handsome returns.
22/ Take inspiration rather than getting influenced:

• Performance comparison should be with oneself rather than comparing with profits of others on the SM.
We have an upcoming two day workshop on October 15th and 16th, 2022.

Venue: Andheri East.

Go through these links and sign up for the workshop.

- FAQ here:

- Registration form:
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