How to map Bank NIfty strike price to Option price

General
1

I would like to understand how I map the Bank Nifty strike price to the Option price. For example, if the current price of Bank nifty is 41000 and I know the price will go up till 42000. In this case if I determine to buy 41000 CE when the price in the Bank NIfty index reaches 42000, then how do I determine at what price should I buy the 41000 CE ?. Many traders provide price in advance in which they mention the option price to buy at. For example Buy 41000 CE at 310. Do they analyste the specific strike price’s chart separately to determine the price? or they look at the index chart and idetify the Option price somehow?

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2

If I understand your question properly, you want to know how much option premium will move with respect to underlying. If that is the case the very simple way is using option Greek delta. Though there are some caveats and values are not exact but surely enough to project option premium.

3

If they are saying an entry price, it’s most likely price referred with the chart.

Some trader who is looking at the option chart will look to enter at the breaking of previous day high. ( an example)

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4

Thanks. Do you have any link or example to show how to calculate this ?

5

I suggest you read theta , vega and gamma as well.

TL;DR :- For ATM just use delta, you can forget rest.

Note:- Nothing is exact but enough to keep stp and project wins or loss!

6

You didn’t understand what he is asking. Even I too struggle to choose at what price should I enter in CE while placing the buy order, with reference to Future price. The price of Call on that particular strike price keep moving up & down, but how to decide /determine myself , am i entering at right premium price of that Call option to enter a trade on that day.?