Options Thread How options allows to change and adjust view dynamically. Let’s understand with a live example. Example : Nifty is at 11921 and you are bullish on Nifty. 1) Buy Naked 11900 CE(call) at 167 Breakeven : 12068 Max Loss : Rs 12555 Max Profit : Unlimited
2) Now your view changes from bullish to slightly bullish so you can convert naked call into a bull call spread by selling 12100 CE at 72 Breakeven : 11996 Max Loss : Rs 7100 Max Profit : Rs 7800 #OptionsTrading #trading
3) Now your changes from slightly bullish to slightly bearish. You can convert the bull call spread into a ratio spread by selling more 2 calls of 12100 CE Breakeven : 12224 Max Loss : Unlimited above 12224 Max Profit : Rs 18550 #OptionsTrading
4) Now if your view changes to sideways then you can buy 2 lots of 12200 CE to convert the ratio spread in a butterfly spread. Breakeven : 11936 to 12182 Max Loss : Rs 2600 Max Profit : Rs 12300 #OptionsTrading
You can see that how you can change your view with the same strategy by doing adjustments. To learn more such insights on options and other market related strategies you can join our educational telegram channel. https://t.me/finsense