Since the margin for Option Trading with hedged strategies has been reduced, What is the best option strategies for person with capital Less than 1 Lakh.
The main thing is there should be least chances of loss , Small profit is acceptable .
Atm short straddles of at least 2-3 strikes
Wings to cover any strong trend
If a particular day is not sluggish, you can buy options to cover operational costs
This I recommend in currency only
For example:
June- 75.25, 75.5,75.75. I have done short straddle
I have done a short strangle using 76 ce and 75 pe
To add to it I use option buying based on the circumstances only, there’s no need to perfectly hedge FX options because that would greatly reduce the profitability.
You will not get full benefit of margin, but at least you are in control
This is my strategy and not a solicitation
Just giving you my two cents of advice. Don’t jump on the Options trading bandwagon just because trading strategies has become cheaper. I agree Options are good source of consistent income if traded properly. You can borrow all the ideas from other traders and try to replicate their trading style but you won’t get desired results, because only they know what decision to take in which circumstances.
There’s nothing wrong in learning from them about their strategies but before you execute them in market, test them by doing paper trading, get hold of the strategy then only deploy it in live market.
More than strategy you also need psychology to handle big fluctuations in P/L, mental awareness to take quick decisions. This will only come with practice.
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Well said Sir,
It took me a lot of money, pain and time to finally swallow my ego
Your advice should be noted by all traders… we often get carried away by success
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