How is this possible [options]?

F&O
1

Hi,

For options trading, is it possible to potentially buy UNLIMITED options (CE or PE) if we have UNLIMITED money (hypothetically)?

When I check the VOLUME TRADED for some companies’ options, it’s very small. Say if the VOLUME TRADED = 40,000 for an option. If I have the money to buy 200,000, can I do so?

And if I can still buy 200,000 options, will I not face problems selling them at the market price? I mean, someone has to buy them from me, right?

Thanks,
Ajay Mehra

2

There is a limit how much you can buy

https://www.nseindia.com/products/content/derivatives/equities/position_limits.htm

You are most welcome to short options especially in BRITANNIA BOSCH etc.

We are looking for people like you who have plenty of money to donate

5 Likes
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Sarcasm at best

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Thank you for the link. About the money donation, you can do better with the jokes :slight_smile:

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Trade nifty options even when nifty future struggle to move in good direction if ur partly correct options can throw u 40% profit easily

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Who incurred auch loss is he is in our tradingqna?

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Options on Indian stocks are very poor in liquidity, due to which you will not able to play with proper stops. Because slippage will be very huge.

Moreover stock options are not available for far away months, this is very detrimental as we cannot take any long term view.

Hence trading Nifty and Bank nifty options only is the best course available right now.

You need to really know what you are doing before you venture into as options positions make you very rich or very poor as your intentions are looking playing large positions.

Any way all the best buddy

Best regards

Ganesh1

1 Like
11

Mr. Hari Babu,

All stocks, futures & options or trades in any asset class go through a clearing mechanism or we can say a clearing house. That is why when you are buying the party selling it will be the clearing house and for vice versa the party buying it from you when you sell will be the clearing house.

Let me attempt to clear your doubts

  1. When Mr. Chirag Gupta makes 18 lakhs, the broker will be held liable to pay this dues to the Government irrespective of the client has the money in his account or not. Then the broker will recover
  2. The client cannot say he will not pay the dues to the broker because all traders/investors who are using the broker’s services have signed relevant documents that helps the broker to hold the client responsible to pay up
  3. If the client does not have the means to pay the broker may take him to court for further recovery possibilities and even then the client may have the option to declare him insolvent and get out.

But it will be a long drawn legal battle…
After this law for STT is impletemented the first month only traders suffered, after that all are vigilant. I have seen even brokers are flashing messages in their portal around 3.20-3.25 PM around market close on the expiry day to alert the traders

Hope this clarifies something at least

With best regards,
Ganesh1

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Thank you to those who have sincerely answered my query. I am not looking to trade with crores, obviously, I don’t have that kind of capital. I am just learning about options, so I want to be sure that I understand them inside out. I heard people making 10-12 crores with a few trades, so just wanted to know if that is possible or not.

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Thank you @Ganesh1.

@Ajay_Mehra You are seeing only one side. If you are able to make 10 to 12 crores then the other guy is losing it. FNO is Zero Sum Game.

If you make profit some one is losing it.

I have seen traders losing 50 crores.

If you start trading if loss comes that should not put your personal life into trouble.

Nothing should happen to you financially even if you lose everything in your account. That is your risk amount. So decide how much you can risk and put only that much amount in trading account.
Happy Trading :+1:

3 Likes
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Thank you for the perspective. I am no way thinking of risking that much money; I know my limits very well and will not cross them (because I am just a student).

It’s more about the scope of money involved. Makes you wonder if one can just keep buying options for as long as they have money. But yeah, now I saw that there are restrictions indeed.

I know a guy that lost 3 crores in Hindalco options some time back. But 10 - 12 crores is just a huge amount.

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Thaks for the wonderfull piece of information…inthus case did the tarder pay the 18lakh?