Comment on Basics on Options Shorting/Writing

M Anantha Raman commented on 26 Oct 2014, 08:21 PM

I want to initiate a calendar spread strategy in Nov 2014. Assuming at that time nifty is trading at 8015. I decided to short sell the Nov 8000 CALL at 57 and BUY 8000 call options at 160 to create a calendar spread. My pay off diagram is as attached. In this you can see that maximum gain is around is 40 but the loss is around 100. How can improve this so that I can get gain is more and loss is less. If possible can you please walk me through this strategy step by step including steps to exit the strategy.

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