Out of 20 trading days of June Expiry Contracts, 17 are gone and we are on Day 18.
So far we have not seen profits.
As far as selections are concerned, some of them have come really good. BHEL and IDEA are the two trades which have done so well and it is imperative for us that these trades should continue to do well over the remaining 3 sessions.
BHEL is now very near to the recent 52 week low made during May Expiry. It should go below that now to give us a nice profitable trade.
IDEA went down very nicely today. Continuation of the trend will help us. So far it has been a good trade. The 52 week low achieved in May expiry was Rs. 50.10.
Should we expect that again. That will be too ambitious a target but stranger things have happened in the market. We shall gladly take the low or even slightly higher price. Only it should not rebound.
How to handle that situation ? :
We can exit from PUT 60 and BUY PUT 55.
This way, a major part of profit gets booked and we are in the trade if at all it continues towards 50 range.
UPL came back today and made another 52 week low.
These three trades helped in recovering major part of the losses in other trades.
PNB also fell by about 2.5% today and now is in the range where it can become profitable.
VEDL had gone up to Rs. 239 but came back all the way to Rs. 230-231 range. We are still with a good chance here.
The picture is better now though not yet profitable.
Futures trades are straight and simple. You make money if you are right. You lose money when you are wrong. we have been right as far as the price moves are concerned. The problem with Options is that the action near the strike price must happen fast, like it happened in IDEA today or UPL few days earlier.
Here is the chart if the trades were taken in Futures Contract on the dates the Options were bought.
Well, these 12 contracts would have made a cool profit of a little more than Rs. 200000 in these 17 trading days.
In Options, we are looking at a loss.
But 12 Futures trades would have required a margin of about Rs. 10 lakhs. In Option Buying, we are risking a much smaller capital.
Once again, no new trades for the day. We have enough to handle.
Disclaimer: This post and examples are for teaching purpose only and are not meant as advice/suggestion to trade in these stocks. Trading in Futures and Options can lead to big losses and should be done with appropriate knowledge and advice only. Mentioning the stocks here does not imply that I have a trading position or likely to take a trade in these stocks.
Dr A SRI SENNATH J ARUL June 26, 2018 at 11:49 am
sir, if i am buying futures is it good to buy current month expiry or three month expiry? which is better? your advice please.Reply
Madan Mohan June 26, 2018 at 4:40 pm
As per my understanding, There will be no much difference if you trade in the current futures and July futures financially. The price differences are little between the two expiry. In that case better to go for July futures.Reply
Madan Mohan June 26, 2018 at 1:21 pm
Tata Motors falling to its 52 week lows. Whereas, Airtel is wavering here and there and eroding our premiums and paper profits and creating tensions for expiry date.Reply