Whereas if you buy 1 lot for Rs20 and it goes out of the money, you lose all the money paid = 20*50 = 1000
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Anything can happen anytime in the market.Money can move anything anywhere. This is the golden truth in market.
Naked option buying has well defined max risk - the premium you paid to buy the option.
Naked selling max risk depends on how much max market goes against you.
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I guess I have a fairly reasonable idea of how much the market can move in a week, so I donât think I will be in a position losing a lot if I buy 1 lot.
Of course, now that I have known about this, I will learn to make covered calls and will not do naked selling.
It wonât work very well. I have tested your strategy too , thought i will be slick and just plainly sell far away OTM options every week and thought its a free way to make money. Now I paper traded it in sensibull quite a while back. The thing here is 80 to 90% your will win, once expiry you get premium or you can square it away as you get your theta premium starts coming after a day or two. It only takes one single crash or market gap to wipe out your gains or wipe your account too.
So does this not work at all, well I have improved this a bit. So what I did was draw a 200 EMA line or 26 SMA or ichimoku kijun San and tried selling far away OTM option strikes opposite to the line. Like if price was below the line I would sell far away OTM CALL option and if price is above the line I would sell far away OTM PUT option. Now this works very well till there are news events. Luckily I tested during corona march 2020 till all the way till July 2020. I certainly didnât find myself profitable or should have hedged it or squared away for safety.
This what I can give you:-
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Weekend overnight positions literally are crazy surprises. Even zerodha warns it very well while placing order. I guess if you can manage this strategy will work.
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Itâs terrible from money management standpoint and it is kinda the main reason I discarded this idea entirety. Your win % is capped, you donât get to participate in those very long trends like option buyer or future holder. You donât get those pips And losses are potentially unlimited or should I say more than profit. Imagine fixed
100 pips gain: 200+ pips loss. Now experts will say âbro itâs not that much amount of loss , its not crypto market will not move than 2%, look world is very unpredictable whether 1991, 2008 or ,2020 nobody could predictâ. -
It sucks too, you are here in f&o for leverage. You canât take much lots. With 1 L you can sell only 1 naked option but with same amount you can buy more lots when you buy option
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Thank you.
Much to understand and learn 
Without proper knowledge , buying or selling both can prove injurious to your hard earned money . I still
donât know why people underestimate stock market ?
Just because you have money doesnât mean that you can do trading .Donât forget , you donât have skill. Give some time to your learnings then put your money into this. Take proper education of this business
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I know what a stock market is, I have some experience with equity. It is the FnO segment that I am unaware of, just wanted to see how FnO works, so 1 lot, and I will be learning some before doing another trade.
And stock market is not rocket science, one can become successful with time, learning and plan. FnO as of now is looking like the toughest nut to crack 
Now-a-days, fno is trending, cause it gives huge rewards. Even im drawn to option buying from starting in stock market, never stepped into cash segment.
So if you are watching volatility of say banknifty for months, you will get adapted to it and will start liking it.
From my experience, to trade in banknifty,
if you are doing intraday
â 1 min timeframe is best to place trade and 3-5 min timeframe is best to exit from trade.
Means, the target should be set according to 3 min timeframe support and resistance and place trade in 1 min.
Your stoploss should also be according to 1 min timeframe. And should be smaller (less than 40-50 points) this is the only way i think you can capture RR of 4-8!
Also, as long as price decisively donât break the trend, you should follow the trend and capture all rally.
This is from my experience, it can be correct incorrect 
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Looks like you have gained some experience and created a strategy, which has helped you become profitable
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It is from my experience man, it can be incomplete or even can hurt otherâs opinions,
but to say it bluntly, there is no strategy kind of thing like which will gonna work. Why Iâm saying this is cause people understand strategy as like strategy drives the market. Strategy is just a way to systemize how you trade.
Thatâs why there are many strategies, cause everyone make strategy according to their comfort. Some tell their strategy to algo.
So, strategy is Not A Real Thing, all strategy is based on something. You have to understand that thing, and that is nothing than ââPRICE-ACTIONââ. Then you can make a strategy for yourself too acoording to your comforts.
Although there are some strategies, which will work to some extant without understanding the basics of market, but you can not Become A Wizard without understanding the real the basic thing.
You definately know about a Gujrati saying ''Bhao bhagwan che".
Price-action is not a matter of hours or days, it is the matter of months and years to learn and SOAK the price.
Many experienced and big traders in this community definately knows that all things are derived from it. Because they understands price action, what they say is very workable, but again, to sit in that king chair 
, you have to go through it.
Price action is like a deep sea, but as much you understand it you will become profitable to that much extant!
I love you.
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That is definately kind a inspiring thing for me in trading, being rewarded by some one who knows the market in itâs most deepness! 
It also helps that im on right path atleast⌠ThanksâŚ
Of course a strategy, just like a derivative has an underlying thing, it could be as simple as price moving 5% in day, or a complex one like satisfying a few conditions all bundled together.
Also, no one strategy works all the time, as markets are dynamic, so all have different strategies. In investing one can say I belong to this particular school of thought, I believe in this particular style of investing, and this has given me profits, so I will not change, I have seen such investors. But I am not sure if trading works like that.
Even I trade depending on different conditions 
Yes, there is a psychological comfort attached to strategies, not all strategies are embraced by all traders.
Also yes to the price action, I have been looking at price action from a basic level after I selected a stock to trade basing on a strategy.
Selected a stock after some thought, added to market watch, at 9.15 the strength is gone, stock is weak, lesser demand than yesterday
Looks like you are creating a perspective, good
I hope it is not sarcasm
Himanshu is riding a Maruti, and you stop next to him in a Ferrari and say ânice ridingâ, and he gets all elated
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Then ronin sha has to come and to clear it 
from his Ferrari car
Cause i see good results in 1 min timeframe for intraday trading, it seems me the only timeframe in regard to get great risk:rewards
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For a person like me, knowledge is found irrespective of place, age or any other thing
Jaha gyaan hai, waha se leta hoon main
gyan bin trading soon you are definately on right path thatâs called smart work
Smart alag hota hai, samrat alag hota hai, main market ka naukar hoon, jo market deta hai, wo khata hoon
Pet bhara to khush, dil bhara to khush
Wow. You my friend seem to have decoded the market!
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