Hello Everyone,
One of the questions that I generally ask my trading friend is, "What should be the intraday SL for nifty 50 options (selling and buying)? And I get different answers to it.
I know that for a few people, it might vary based on system, ratio, and setup, but on average, what should be the SL points?
It would be great to see people’s point of view in regards to intraday SL.
Thank you
There’s really no answer to this. Nifty option can be ATM, ITM or OTM. It can be a week to expiry or the expiry day itself. It can be a directional trade or both side options might have been sold. So basically it can literally be anything under the sun and there’s no fixed formula to get perfect sl.
All sls will hit at some point. Wide sls have a higher win rate(in option selling) but worse risk reward. Smaller sls are the opposite. So backtest some systems and figure out what works for you.
Karthik rangappa said that sl will change from stock to stock based on volatility so use standard deviation to put stop loss. Read zerodha varsity.
It is not fixed, based on your setup you have to decide. it will vary according to market volatility. every trade has its own stop loss
Hey @emrys11,
I understand that there is no formula for the perfect SL, but what is your opinion on the ATM and ITM strike prices from a directional perspective on a good system targeting 30–40 points?
Hey @nifty_trader1,
Trading on stocks and placing SL can work well with the systems; many, and even I, like to place SL on the last swing; some even use SD, as you mentioned.
But what you view as nifty options (selling and buying) only on ITM and ATM strikes.
it is just an example, don’t consider this as a setup.
for e.g you are trading breakouts or break downs, as in the image in first trade sl is around 37 and in second trade it is around 24. In both trade - time frame , setup and sl condition is same but stop loss value different. so evry tarde has its own stop loss. i hope you understood
@vighnesh
I see that you use the last swing, high or low, as the SL area. But using this on options (buying or selling) may vary a lot compared to the spot price.
So, do you use the same concept on options?
i already told you this is not my setup , just an example. if you are trading in options , do not trust option chart always use spot.
