Please help me with a detailed explanation on which strike price to select. I have read few articles but yet not clear. many say dont buy OTM options as they are a total waste of money.
I want to know the basis to select the strike price for an option. Thank You
Hi Abid…
Nice topic to get queries cleared from an option expert 
How viable is this strategy…
Buy 750 Nifty bees (as 1 nifty bees = 1/10th nifty)
Sell nearest itm call option at start of every month to get d premium…
How u see payoff graph in all cases…
5% up, down or flat from entry price at month end
Sorry for d trouble 
@Abid_Hassan Sir
I updated my questions above. You must not have read, so repeating here.
I have been trading in Bank Nifty Options. I sell weekly options and buy far monthly options. I have a proprietary strategy to manage positions. Results have been encouraging so far.
I am trading in Calendar spread for Bank Nifty… selling near term weekly options and buying far monthly options… have to manage near month options a bit carefully than far monthly options
Hey @tushjain00,
Thank you for this question!
We re building that as a product. Basically if you tell us your view, we will tell you what strike to exactly pick to maximize profits. So let us say your View is NIFTY 10380 on expiry, whether you should sell 10300 Put, buy 10300 call, buy a 10300-10400 call spread, is something you can think. So with this tool you just tell us the target, and voila! we will give you what to trade. If you are interested in the early bird beta, please email me on [email protected]
Which strike to select is a complicated question. Complicated enough to build a product 
But here is the general drift
1) If you anticipate small moves, selling options is better than buying options.
Because you have to compensate for the premium and STT which is 12 points on NIFTY and 30 on Bank NIFTY
So if you think a 50 point upmove on NIFTY, sell 10300 put rather than buy 10300 Call. If you are worried about downside, buy another put, say 10250 or 10200
2) If you anticipate HUGE moves, buying options is better than selling options.
I dont think there is a need to explain anything here except for one thing.
ATM and near ATM options are more probable to give you profits. OTM options are less likely to give you profits
So say NIFTY is at 10300, at 10300 Call will be around 50 bucks, 10400 around 16 bucks. If NIFTY expires at 10400, you wont make any money on the 10400 but around 35 bucks, STT adjusted on 10300.
If NIFTY goes to 10500, you will make 135 bucks on 10300, and 65 bucks on 10400 call.
But the difference here is that your ROI on 10300 is 135/50 = 2.7x, but on 10400 it is 65/16 = 4x
TL;DR . If you are buying options, it is safer to play near ATM, and if you like living dangerously, but OTM 
3) Medium sized moves is where all the confusion comes.
It is hard to say if you should do straddle, strangle, call spread, put spread, buy call, or sell put, or whatever! But hey, that is what we are solving, and solve that we will for you soon!
Do let me know if I can be of any further help!
Hey @maddy_Des
Honestly I am new to this term. Not sure how this works. I googled, no help. Tell you what, I will ask around and let you know? And in the process we both get to learn something new!
Vipul, Basically what you are doing is what is called covered called strategy.
Hello @VIPULK,
Thanks for the question!
Basically what you are doing is a covered call.
Let us simplify it. Say you have one nifty option, and one nifty stock. You buy one nifty and sell one nifty option. Let us analyse the scenarios
But hey! That is nothing but a sell NIFTY put option!
Covered call gives you the same pay-off as a NIFTY put sell. I would say it is better to sell NIFTY put than do the covered call because
currently i am trying intraday in bank nifty weekly options to take advantage of time decay …
results are encouraging so far , but the problem is i end up losing 3/4 Rs per lot on bid-ask spread itself …
let me backtest your calendar strategy then when i get time … are you hedging it with the same strike or OTM strike on montly options?
few things i tried which didnt work out ,
calendar spread between current and succeeding week bank nifty options … lack of liquidity and also theta decay affects the succeeding week options as well , so left it…
ex: sell 25000 call and put for current week and hedge it with 25900 call and 25100 put
iron condor and reverse iron condor on weekly options and both are inconclusive
Dear Sir,
Can you tell me what will happen if I Buy Near month Nifty Future/CE and sell next/far month future/CE?
What its called?
Bank Nifty weeklys are very tricky. Although Bank Nifty appears to be a volatile index, however, I have seen that consistent trading of either volatile strategies or non-volatile strategies will not yield results. So I agree with you.
Fair enough Abid… Thnx for d effort
Wud b great to have some option payoff simulator with different strategies so that we can play with inputs also corresponding margins…
Also What deters d small trader is high margin required for selling options …
If some binary spread strategy (locked as simultaneous buy or sell) is introduced then that wud reduce d margins required considerably…
Eg for bull call spread/ calendar spread … Single click enter or exit for both positions simultaneously …
Anything as such to be introduced in kite in near future ?
Bid-Ask rate diff is an issue with not so liquid options… so you need to pick strike price carefully.
I trade mostly at ATM
It depends which options you are buying/selling OTM/ATM/ITM
I have tried all possible options strategy for delta neutral… I agree nothing is conclusive…
What I found, current week most options are liquid so bid-ask prices are close by. Far week options are hardly liquid so avoid trading in those until a day before or so of the current week expiry… for far monthly options stick to strike price with multiple of 500 and you could still exit them fairly well as bid-ask price could still be close to each other (avoid market trade in far monthly options)
This bank nifty weekly options is not my main strategy , tried almost all directionless strategies parallely and almost all are inconclusive (real trades ) 
Yet to try calendar spreads properly , left it because of its longer duration.
Currenytly testing intraday in weekly options , out of all this seems to have good potential.
Usually i do it in ATM options and my OTM hedges are 200 to 300 points apart.
If we want to do 30 lots and above and need to buy a or sell a pair of options withiut chasing the price , i have no option other than putting market order .
Bid-ask spread is like 0.5Rs till 9.45 AM ( similar after 3PM ) , but after that it jumps to minimum 1Rs.
I developed java app for me using kite apis , as of now firing everything as market orders.
Planning to get the data and fire it as limit order and then turn to MKT order if it doesnt execute completely within 2/3 seconds ( but getQuote fails regularly ).
Guys, Lets stick to posting queries to Abid Hassan only in this post & refrain from discussing abt Options among ourselves.This wud ease reading the valuable replies frm Abid. I hope everyone agrees with me!