DIFFERENCE BETWEEN CALL AND PUT OPTION

An Options are of two types one is call option and other is put option, let’s look at the differences between call and put option to get a better idea about both of them –

1.    A call option is one which allows the buyer of the option to buy an agreed quantity of stock, while put option is one which allows the buyer of the option to sell agreed quantity of stock

2.    A person who buys call option is bullish on the stock while the seller of call option is bearish on the stock....

BOOK PROFIT IN SESAGOA BULL CALL SPREAD

BOOK PROFIT IN SESAGOA BULL CALL SPREAD GIVEN ON  
10 DEC 2012
190 CALL TRADING @ 9
200 CALL TRADING @ 3
NET GAIN 6
COST 3.5
NET PROFIT 2.5*1000 =2500 PER LOT

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SESAGOA OPTION STRATEGY(BULL CALL SPREAD)

LEG1: Buy SESAGOA 190 call @ 6

LEG2: Sell SESAGOA 200 call @ 2.50

Net Risk  =(6-2.50)*1000=3500

OUT LOOK  5-7 Days

Pay off table....

BOOK PROFIT IN NIFTY STRADDLE STRATEGY

NIFTY STRADDLE STRATEGY ROCKS!!!!!!!!!

Nifty 5600 straddle strategy given on 19 nov 2012 composed of 5600 put @ 50 and 5600 call @ 45.

Nifty closed at 5825 today. The total cost of this strategy was 95.

Return from 5600 call = 5825-5600=225

Return from 5600 put= 0

Profit per lot is (225-95)=130.

Total   profit given by this strategy is 130  per lot. Hope u have booked profit.
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HOW TO PUT STOP LOSS IN OPTION?

A stop loss is an order placed with a broker to sell a security when it reaches a certain price and is designed to limit an investor's loss . A good stop based on closing prices is one that is placed 3% below a rising trend line. The stop is triggered only if the stock closes at or below the stop....

COVERED CALL OPTION

Selling the call obligates you to sell stock you already own at strike price  if the option is assigned. One can run this strategy after they have already seen nice gains on the stock. Often, they will sell out-of-the-money calls, so if the stock price goes up, they are willing to part with the stock and take the profit....

HEDGING FUTURE WITH OPTION

Hedging in common words is insuring against a negative event. This doesn't prevent a negative event from happening, but if it does happen and you're properly hedged, the impact of the event is reduced.
 HEDING FUTURE WITH OPTION

 1.Note the size of your futures position and buy a corresponding number of options.....

NIFTY LONG STRADDLE STRATEGY

Buy Nifty 5600 call @45

Buy Nifty 5600 put @50

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PAY OFF TABLE

OPTION BUYING V/S WRITING

Definition of  Buy-Write

Option buying means buying a put option and option writing means selling a put option. Option buying has limited risk where as option writing has as much risk as future.

OPTION BUYING V/S OPTION WRITING

1.Buying options - limited loss, unlimited profits where as Writing options - limited profits, unlimited losses 

2.Option writers have a significantly higher chance of making money as compared to option buyers......

DIWALI 2012 PICKS

1.PANTALOON R

   Buy  around 198 tg 259

   Expected returns= 23.55%

 2.ALEMBIC PHARMA

   Buy  around 68 tg 99-100

   Expected returns=32%...