I have had good success with Futures. I prefer buying Nifty futures and shorting Bank Nifty Futures. I also sell Options, I have an algo based approach (but place trades manually).
Risk/Reward and ROI of Option buys can be so much more lucrative if one can get it right. I am looking to shift a major portion of my trading towards Option Buying now. So more recently I have been doing smallest of Option Buys and testing the waters. I think I am getting the hang of it a lil bit. Futures are so much more predictable though
I am looking for views from experienced and successful option buyers like @t7support and others on the following points that I noticed.
I mostly buy ATM options. If the expiry is in less than 3 days, I feel it is important to go ITM. I am sometimes more inclined to go ATM with the next expiry such that I get 6-8 trading days to expiry.
I look to square-off same day or next day most of the time. I notice that if I take it to 2nd and 3rd day - and the spot moves against us, the loss would be substantial - the theta and delta combine to eat up premiums. 2nd or 3rd day, if spot is at a -0.5% - the loss there would often be equal to the profit that a +0.75% movement would have given. This aspect is reduced a good deal when you get out same day or next day.
I really would like views of successful option buyers on the above 2 aspects and more. No need to be gentle
I buy ITM options close to the spot so that time value is less and get more movement with spot.
I buy and hold for an average of 4 days until my software signal gives a trend reversal. The delta and theta effect cancels out with my 47% accurate strategy over a period of time. So am not worried about that.
My strategy is super simple which is its usp. The simplicity helps with consistency which leads to lucrative yield on capital. I already gave you access to my software for some time.
Signal generation part is automatic. The trade execution part is manual. Software gives nifty bullish and bearish levels for next day after market close. So from that info I estimate the put or call option prices and put stop loss limit orders in broker terminal. Then when ever market reaches the price level the order gets executed.
Thank you @t7support I peeked into your discord community and went through example trade setup. So you book profits at every decent spike and enter again at next strike. Nice
Every time the bought option moves by Rs.100 I exit that strike and buy the next strike. For calls this will be the next higher strike and for puts this will be the next lower strike. This locks profit and reduces risk.
Well the price estimation is crude. The point is never to loose more than the difference between option LTP and the reversal level. As option price doesn’t move 1:1 with spot I simply take the difference between LTP and reversal level and multiply it with a time dependent weighing factor. This value is then used to estimate the future price of the ITM option - add to the LTP of option for entry orders and subtract from LTP of option for exit orders.
Entry will be as soon as 17800 is hit if 17800 is my reversal level.
See you know the LTP of the option. The value with which the price needs to be adjusted can be generated from the software if user enables the corresponding setting. So you have everything to enter and exit once you have the software.
I think this is getting in to bit of a marketing zone in here. I was just responding to queries here since there is a huge misconception in the market that option buying is a sin and option sellers walk on water.
With discretionary adjustments and fire fighting inevitable in option selling, courses can be sold for whopping amounts. With simple option buying there is nothing really to sell via a classroom.
So if you have anything generic pls ask here. Anything else DM me.
But on the basis of historical results risk : reward is approx 1:2