A very flat day for the broader market.
In 9 days of trading in this month, NIFTY has moved up from 10792 level to 11343. A 550 points gain has come very swiftly. Out of these 9 trading days, only 1 day was slightly negative while other 8 days ended with gains for the Index.
Expecting PUT options to do well in this kind of trend is asking too much. The problem was that even one CALL which we had was not doing well all the time. It performed a little in the last two trading days and that is some consolation.
The trades in HEROMOTOCO which had gone bad initially is showing signs of a changing trend. But it has already lost considerable value and we need a sharp decline in the stock price to have a chance in this option. HINDPETRO can be classified as a completely lost case now. BIOCON and INFY are still in with a chance and so is DRREDDY.
We take the trades based on a method and then there is not much to do. The second part is not to over trade as big losses cloud the judgement and that makes taking new trades very difficult. The third part is to keep our belief when the trades are not doing well. It is very easy to stay in the trades which are making money. The test comes when the options prices go south and days are ticking away. Passing that test is important.
Yesterday’s moves did not do much for our trades. The little gain in YESBANK was taken away by the loss in DRREDDY and BIOCON.
The position improved slightly compared to previous day.
Once again, Asia Markets are in the green, SGX NIFTY is up 19 points and it looks like a positive open for the NIFTY. What happens after that? Your guess is as good as mine.
No new trades today.
Trade cautiously, trade profitably.
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.