Comment on Option buying: The riskiest trade out there

kirankumar commented on 03 Jul 2021, 05:33 PM

on your comment i like to share you on average how it works , really averaging is a good idea but high investment but sure shot in option buying wre u must make your time decay “0” that means u must avg to the price where the premium is running and u must equally buy the same quantity of cost price u bought initially .

for example
nifty 15700 @ Rs 60 (Friday) u bought 1 quantity = 60*75 = Rs4500
and now it is running for 30rs(Monday)
keep in your mind your premium is set to be zero only on Thursday so it will fluctuate ( 0 to Rs.60 only )
if it go up its not a problem to you ,

npw come to preimum fall Rs 30 and the preimum is and levels are perfectly match u know it preimum will go atleast Rs.1 from here , then make an avg now to spot price premium and equally the initially price =quantity (4500) so, that your Avg come to present premium and u hold 4500 qunaity if the market goes on your expected direction u will get mulitiple of your 4500 simple but make sure that quantity and premium shold match and time decay is 0 and u must exit

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