Comment on Basics on Options Shorting/Writing

arm239 commented on 29 Jul 2014, 01:21 AM

Dear Nikhil,
Suppose I want to place a bull call spread strategy on nifty trading at say 7790. I am buying CALL 7750 @55.20 which I am keeping fixed and tried SELLING CALL at different strikes as below.
1 selling 7850 @ 11.95 my profit is approx. 54 and loss is 42
2. selling 7900 @ 5.80 my profit is 100 and loss is 50
3. selling 7950 @ 2.70 my profit is 150 and loss is 50.

What it indicates the far the strike you sell the more profit. am I correct? If I want to choose a BEST SELL strike HOW WILL I DO?
For this example I am taking the data from OPTION ORACLE software.

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