We gave a miss to this setup in January series.

The reason was the low premium receivable.

The same condition prevails today but the margin amount has also come down in view of ICICIBANK lot size being reduced to 700 from earlier 1375.

Trades worked out based on Friday’s prices are:

SELL HDFCBANK PUT 1600 @ 12.20 Credit — 6710

SELL ICICIBANK PUT 850 @ 13.90 Credit —- 9730

SELL KOTAKBANK PUT 1700 @ 18.30 Credit — 7320

Total Credit — 23760

BUY BANKNIFTY PUT 40500 3 Lots @ 174 Debit — 13050

Net Credit — 23760 – 13050 = Rs.10710.

The amount is not much. In earlier series, we have received credit of Rs. 22000-30000 quite regularly. In some low volatility situations, we got at least 14000-15000.

But margin amount used to be above Rs. 500000 in those times.

Currently margin requirement has come down as can be seen from Zerodha margin calculator.

We add the cost of BUYING BANKNIFTY PUT Rs. 13050 to this amount and the total comes to Rs. 335716.

Let us consider this amount as Rs. 340000.

With lower capital outlay, we have to accept the lower initial capital. We give it a try for this series and see how it works out.

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.