Nifty options no loss strategy

But how to spot a winning strategy? It all depends on your comfort level and knowledge. Let us have a good overview of some of the popular options strategies. Read on. There are many options strategies that you will use over the period of time in markets. But, there are roughly three types of strategies for trading in options. Firstly, you have the bullish strategies like bull call spread and bull put spread.

Secondly, you have the bearish types of strategy such as bear call spread and bear put spread. Before you begin reading about options strategies, do open a demat account and trading account to be ready. You may never know when you get an opportunity to try out a winning strategy.

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A bull call spread is an options trading strategy that is aimed to let you gain from a index's or stock's limited increase in price. The strategy is done using two call options to create a range i. A bull call spread can be a winning strategy when you are moderately bullish about the stock or index. If you believe that the stock or the index has great potential for upside, it is better not to use a bull call spread.

In a bull put spread options strategy, you use one short put with a higher strike price and one long put with a lower strike price. Like the bull call spread, a bull put spread can be a winning strategy when you are moderately bullish about the stock or index. If both bull call spread and bull put spread are similar, then how do you benefit if they are both top gainers in terms strategy utility?

The difference lies in the fact that the bull call spread is executed for a debit while the bull put spread is executed for a credit i.

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A call ratio backspread is an options strategy that bullish investors use. This strategy is used when investors believe the underlying stock or index will rise by a significant amount. The call ratio back spread strategy combines the purchases and sales of options to create a spread with limited loss potential, but importantly, mixed profit potential. The call ratio back spread is deployed for a net credit.

Remember, the loss is pre defined at all times. In a Bear Call Ladder strategy is a tweaked form off call ratio back spread. This options strategy is deployed for net credit, and the cash flow is better than in the call ratio back spread. The Synthetic Long and Arbitrage options strategy is when an investor artificially replicates a long futures pay off, using options.

The trick involves simultaneously buying at-the-money ATM call and selling at-the-money ATM put, this creates a synthetic long. Open a demat account with Nirmal Bang and use special options strategies today to make a profit. A bear put spread strategy consists of buying one put and selling another put at a lower strike.

What are the complications involved in this Strategy ?

This is to offset a part of the upfront cost. But by writing another put with the same expiration, at a lower strike price, you are making a way to offset some of the cost. This winning strategy requires a net cash outlay or net debit at the outset. A bear call spread is done by buying call options at a specific strike price. At the same time, the investor sells the same number of calls with the same expiration date but at a lower strike price. In this way, the maximum profit can be gained using this options strategy is equivalent to the credit got when starting the trade.

This approach is best for those with limited risk appetite and satisfied with limited rewards. The put ratio back spread is also a bearish strategy in options trading.

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It involves selling a number of put options and buying more put options of the same underlying stock expiration date, but at a lower strike price. The put ratio back spread is for net credit. The word straddle in English means sitting or standing with one leg on either side. It is necessary to assess how low the stock price can go and the time frame in which the decline will happen in order to select the optimum trading strategy.

Selling a Bearish option is also another type of strategy that gives the trader a "credit". This does require a margin account. The most bearish of options trading strategies is the simple put buying or selling strategy utilized by most options traders. The market can make steep downward moves. Moderately bearish options traders usually set a target price for the expected decline and utilize bear spreads to reduce cost.

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This strategy has limited profit potential, but significantly reduces risk when done correctly. The bear call spread and the bear put spread are common examples of moderately bearish strategies. Mildly bearish trading strategies are options strategies that make money as long as the underlying asset does not rise to the strike price by the options expiration date.

However, you can add more options to the current position and move to a more advanced position that relies on Time Decay "Theta".

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These strategies may provide a small upside protection as well. In general, bearish strategies yield profit with less risk of loss. Neutral strategies in options trading are employed when the options trader does not know whether the underlying asset's price will rise or fall.



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Also known as non-directional strategies, they are so named because the potential to profit does not depend on whether the underlying price will increase or decrease. Rather, the correct neutral strategy to employ depends on the expected volatility of the underlying stock price. Neutral trading strategies that are bullish on volatility profit when the underlying stock price experiences big moves upwards or downwards.

They include the long straddle , long strangle , long condor Iron Condor , long butterfly, and long Calendar. Neutral trading strategies that are bearish on volatility profit when the underlying stock price experiences little or no movement. Such strategies include the short straddle , short strangle , ratio spreads , short condor, short butterfly, and short calendar. Following Black-Scholes option pricing model, the option's payoff, delta, and gamma option greeks can be investigated as time progress to maturity:.

These are examples of charts that show the profit of the strategy as the price of the underlying varies. From Wikipedia, the free encyclopedia. This article needs additional citations for verification. Please help improve this article by adding citations to reliable sources. Unsourced material may be challenged and removed. Retrieved Epsilon Options. Categories : Options finance.