I use 2 intraday strategies and they might give me opposite trades at one time, is it possible to execute both in one trading account. For example first strategy gives a buy at 7500 and second strategy gives a sell at 7505, but I wan’t both the positions to remain open, is it possible?
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I think this would depend on the intraday products provided by broker. My broker, Zerodha provides me 3 intraday products. MIS [Margin intraday square off], CO [Cover Order] and BO [Bracket Order]. So I can go LONG using MIS product type at the same time i can go SHORT using CO product type.
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Yes it is possible, but the cost goes up.
In your case you want to buy at 7500 and sell at 7505. Essentially you want to be both long and short on Nifty. So this means there are 2 legs to this trade..Long Nifty and Short Nifty. One of them can be easily initiated via Nifty futures contract. For example short Nifty can be initiated by shorting Nifty futures @ 7505. The other leg (Long Nifty) has to be synthetically created. This is called a synthetic long position.
To synthetically create a long position you need to use options.
In this case a Long on Nifty 7500 CE + Short 7500 PE creates a position which mimics the pay off equivalent to Long Nifty@7500. By executing this trade simultaneously the non linearity of option goes away and the combined option position behaves as a future. If you dig a bit deeper and understand this position in terms of option Greeks you will understand that Long call +short put, of the same strike and same expiry has a delta of 1 which as as good as the underlying/futures.
So to answer your question, it is possible to be long and short at the same time in 1 account by using both futures and options.
The options part is called the synthetic position. To synthetically create a long position buy call+short put, same strike same expiry.
To synthetically create a short position buy put+sell call same strike same expiry.
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Yes, he can short using CO and take a long position in MIS
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Check out Nithin’s Answer
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Yes, it is possible to take trade of two strategy in 1 account.
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Either can take both positions in intraday product i.e MIS & CO
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Can take trade using MIS & NRML (for intraday) in the same contract.
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Yes, you can provided you enter in different product types like MIS, CO,BO and NRML.
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Yes, he can but option writing cost is high as well risk is high.
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Yes it can be taken with reference to day and carry forward positions known as MIS for intraday and NRML for carry forward positions if he has sufficient cash margin in his account
if you want both the position open you can have an another strategy with reference to same product as Nrml buy this month Nifty and sell Nifty next month it gives you an hedge as well as the benefit of your strategy with one sided margin benefit also
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Hey Karthik, Never thought on these lines, 
, but yeah I was looking at trading using Nifty futures itself, so I guess I will use different order types, NRML and MIS on Nifty futures and hence be able to keep both positions open.
Synthetic trades are quite useful, especially in Box Spreads
Seems quite expensive, but good one.
During high voltilities, will the synthetic option work equivalent to futures?
I know option prices vary too much.
Yup, synthetics mimics futures irrespective of the mkt volatility.
Just to add to this, if the idea is to take intraday opposite positions on stocks, you can take opposite positions on NSE & BSE
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Hi…Can we do this by buying and selling two different cover orders at the same time?
Use case: If I expect a big move in the market but not sure of the direction, I could buy and sell CO order with stop loss set on both sides. After the big move, I would have made a small loss in the losing order and big profit in the winning one.
Is this possible?
You can’t do this. But what you can do is use cover order on one side and bracket order on the other.
Thanks Nithin! But wanted to try it in MCX market. Hoping to see bracket order in MCX soon.
I got what you are trying to say. In options its called the “Long Straddle” strategy. Strategy for consistent profit no matter stock goes up or down(especially when you are in dilemma). You can apply the same concept for intraday equities.
The conditions for the strategy to work:
Both order to be fulfilled at the same price or little price difference simultaneously. Or place BO opposite order immediatly after the 1 leg order gets fullfilled. If the market is moving very fast then both orders may not get fulfilled. So this strategy won’t work.
When to use this/ context:
Suppose a stock trades continuously on bollinger upper band or lower band. And you are in a dilemma whether the trend continues /consolidates or pullback occurs then this strategy will be of help.
When this strategy works in favor:
Stock should hit one side SL and reach the target. Then both order gets squared off.
Disadvantage:
There is a possibility that both SL being hit if it goes up and down very fast. So to trade at upper or lower bollinger bands which would give only two directional movements.
This strategy considers only probability of winning, profit potential is less unless a big breakout or pullback occurs in one direction.
This can be one leg BO and other leg CO.
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