May 2018 Series— We Trade Options– Day 06

Yesterday was this:

With this kind of fall one would expect that our PUT options would be performing wonderfully. Life in the market is never so simple and straightforward. Every stock makes its move in a manner designed to confuse and confound the trader.

Let us just relive what happened yesterday.

HINDPETRO: Made a good down move initially and promptly made the new 52 week low at Rs. 289.25. Before you could enjoy the feeling of PUT price having doubled, there was a sharp recovery and it went up to Rs. 298.15 which was higher than the previous close. Remained in the 294-95 zone for most of the day and ended up at 294.85 with no gain or loss.

The PUT 290 closed mildly higher than previous day.

As the stock has just registered another 52 week low, it tells us to stay in the trade.

TATAMOTORS : It flattered to deceive. Stayed lower most of the day and when we were expecting a sharp down move, it went up suddenly. it does not matter what the Index is doing. It is your trades that matter. This one went mildly wrong for us.

We still remain with the trade.

SBIN : Went down initially, recovered thereafter. Stayed positive most of the day and gave up the gains in the last hour to close flat. A nowhere day for this stock. For us, there is a slight loss of premium due to the time wasted.

BHEL : BHEL finally showed the weakness which we were anticipating. It moved down to Rs. 83.85 at one stage to finally settle at Rs. 84.25. We are in PUT 80 which is still a good 5% away. Remember that we had entered the trade at a premium of Rs. 0.55 when the stock traded at above Rs. 88.

On a negative day, the performance by the PUTs was lukewarm.

What could be expected from CALLs?

HINDUNILVR : Hindustan Unilever found its feet yesterday and remained positive for most of the day and ended up that way. Over last two days it had lost significantly. Made up part of those losses.

M&M : Another disappointing day. Went down by 1.16%.

We can not win them all.

Let us see what was the final status of all the six Options :

Doing well so far and there is no indication yet for anything contrary to these trades. So we stay with them for sometime till some big move happens.

UPL : i had added UPL to the PUT list yesterday. PUT 680 was easily available for Rs. 9.00. It went down to Rs. 8.05 and then traded up at Rs. 10.55. Ended up at Rs. 8.85.

We shall consider entry price at Rs. 9.00 and settled price at Rs. 8.85.

The weekend is here. For the week gone by our trades have done well. We look forward to the next week for better results.

Keep visiting and keep reading.

Post your selections and the situation in the comments.

Enjoy the weekend.

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.

Comments

SHISHIR CHAKRABORTY May 5, 2018 at 5:00 pm

Sir my selections are these:
HclTech 1180 CE
Niittech 1250CE
INFY 1240 CE
Reliance 1060 CE
Your views sir. Presently, they are not doing well since IT has deeply corrected in past 2-3 days. Should I hold them for May expiry? Regards

admin May 5, 2018 at 8:40 pm

Dear Shishir,

Unfortunately IT sector has taken a major hit in the last few days. Staying with the trades is a personal matter. all these CALLS looked reasonable when entering the trades. HCLTECH has gone absolutely wrong. INFY is still okay. RELIANCE is also not too bad. It is a long expiry month and many things can happen over a month.
But you will need courage and conviction to be with your trades.
Last month had bought HINDPETRO 330 PUT for APRIL Expiry on March 28 ( March Expiry Day ) for Rs. 7.20. Few days later it was down to Rs.1.20. Looks like your HCLTECH case. I did not get out . Waited with it and was out few days before Expiry at Rs. 30.00. On expiry day, the high price was Rs. 32.00.
Markets can reward the patience at times with a turn around.
And the PUT had given more than 300% profit when NIFTY had moved up all the time during the month.
Just have a review of your total outlay and recheck your conviction about the trade.
Thanks for visiting OptionsNext and the comments.
Reply
- SHISHIR CHAKRABORTY May 7, 2018 at 9:50 pm
  
  So True Sir. I still have conviction in them due to changing geo political factors and comparatively subdued performance by other sectors. Your HINDPETRO case strengthens my wall of patience and belief. Will keep them till expiry. Market is supreme entity to decide its fallout. Thank you Sir for pacifying my high tides with your experience rich answers. Regards.
  Reply

AbhrajitMohanty May 5, 2018 at 10:41 pm

Very nice job sir. Do you have any telegram channel or Twitter account. I request you for continuous posting in twitter account and/or in telegram channel regarding call/put buying suggestions. We are very small investors. Hope you will help us and save us. If any reply sir… Please..

AbhrajitMohanty May 7, 2018 at 7:59 pm

Sir please reply.

SHISHIR CHAKRABORTY May 5, 2018 at 5:00 pm

Sir my selections are these:
HclTech 1180 CE
Niittech 1250CE
INFY 1240 CE
Reliance 1060 CE
Your views sir. Presently, they are not doing well since IT has deeply corrected in past 2-3 days. Should I hold them for May expiry? Regards
- admin May 5, 2018 at 8:40 pm
  
  Dear Shishir,
  
  Unfortunately IT sector has taken a major hit in the last few days. Staying with the trades is a personal matter. all these CALLS looked reasonable when entering the trades. HCLTECH has gone absolutely wrong. INFY is still okay. RELIANCE is also not too bad. It is a long expiry month and many things can happen over a month.
  But you will need courage and conviction to be with your trades.
  Last month had bought HINDPETRO 330 PUT for APRIL Expiry on March 28 ( March Expiry Day ) for Rs. 7.20. Few days later it was down to Rs.1.20. Looks like your HCLTECH case. I did not get out . Waited with it and was out few days before Expiry at Rs. 30.00. On expiry day, the high price was Rs. 32.00.
  Markets can reward the patience at times with a turn around.
  And the PUT had given more than 300% profit when NIFTY had moved up all the time during the month.
  Just have a review of your total outlay and recheck your conviction about the trade.
  Thanks for visiting OptionsNext and the comments.
  - SHISHIR CHAKRABORTY May 7, 2018 at 9:50 pm
    
    So True Sir. I still have conviction in them due to changing geo political factors and comparatively subdued performance by other sectors. Your HINDPETRO case strengthens my wall of patience and belief. Will keep them till expiry. Market is supreme entity to decide its fallout. Thank you Sir for pacifying my high tides with your experience rich answers. Regards.
AbhrajitMohanty May 5, 2018 at 10:41 pm

Very nice job sir. Do you have any telegram channel or Twitter account. I request you for continuous posting in twitter account and/or in telegram channel regarding call/put buying suggestions. We are very small investors. Hope you will help us and save us. If any reply sir… Please..
AbhrajitMohanty May 7, 2018 at 7:59 pm

Sir please reply.

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