Option Strategies – What is “The Short Straddle” ?

Option Strategies – What is “The Short Straddle” ?

Those who already read our “Long Straddle” Strategy would understood that for the long straddle to be profitable, we need a set of things to work in our favor, reposting the identical for your quick reference – The volatility should be relatively low at the time of approach execution
The volatility should increase during the conserving period of the strategy
The market should make a large go – the direction of the move does not matter
The predicted large move is time bound, should manifest quickly – well within the expiry

Long straddles are to be setup round major events, and the outcome of these events … Read the rest

Option Strategies – The Long Straddle Strategy

Options Strategies – The Long Straddle

Number of times times have you been in a situation where you take a trade with great confidence, either long or short, and the market immediately reverses direction after you begin the trade? Your entire strategy, planning, effort, and capital are thrown out the window. I’m sure we’ve all been in a position like this. In fact, this is one of the reasons why most expert traders go beyond standard directional bets and develop systems that are resistant to market volatility. “Market Neutral” or “Delta Neutral” tactics are those whose profitability isn’t entirely dependent on market direction.

Long straddle is perhaps the simplest market neutral strategy to implement. Once implemented, the P&L is not … Read the rest

Support and Resistance in Trading

Support and Resistance in Trading Stocks, Indices – Importance

Support and Resistance in Trading Stocks, Indices – Importance

Now we Cover here are below important must know elements in Trading Stocks

  1. Support and Resistance Defined
  2. The Basics on how they are calculated
  3. Trendlines
  4. Moving Averages
  5. Other Indicators

Significance of Support and Resistance Zones

Support and resistance levels are used by technical analysts to identify price points on a chart where the odds favour a pause or reversal of a prevailing trend.

Trading level support and resistance are undoubtedly two of the most hotly debated aspects of technical analysis. These terms are used by traders to refer to price levels on charts that act as barriers, preventing the price of an asset from being pushed in a particular direction.

 … Read the rest

NR4 Candle

NR4 and NR7 Trading Strategy – contraction and expansion technique

Narrow Range 4 and Narrow Range 7 (NR4 and NR7 Trading Strategy)  – contraction and expansion technique

The NR4 and NR7 Trading Strategies assist us in locating stocks ahead of time so that we can prepare for and profit from impending stock movement. The market goes through regular contraction and expansion cycles, which is where the NR4 and NR7 Trading Strategies excel.

In this trade setup, you should patiently wait for the market to enter into contraction, which means for the range of the bars to narrow. When we see NR4 or NR7, we can expect a larger price movement and direction. It is a breakout and reversal pattern that aids in profit generation after a range.

What we cover

… Read the rest

Option Chain Analysis in Trading

Option Chain Analysis in Trading

First lets cover the basics of Option chain….

  1. What is open interest?
  2. How to study option chain table
  3. The element of the option chain table
  4. How to interpret option open interest
  5. Use of open interest
  6. Market Structure Principles

Price moves within a structural framework of the supply and demand zone. A breakout of the structural framework supply and demand zone will lead to price movement in the next area of the framework of the supply and demand zone

CPR with Resistance and support levels

OPTION CHAIN COMPONENT

WHAT are ITM (IN THE MONEY) OPTIONS?
  1. A call option is said to be in ITM if the strike price is less than the current spot price of the security.
  2. A put option is
… Read the rest

Advice, Tips and Tricks for New Stock Investor ?

What percentage of your portfolio should be invested in stocks?

There is no hard and fast rule, but as you get older and closer to retirement, you should lower your stock exposure in order to preserve your cash. As a general rule, subtract your age from 110 to determine the percentage of your portfolio that should be invested in equities, and alter this percentage up or down depending on your risk tolerance.

Individual stocks vs. index funds?

An index fund allows you to invest in a variety of equities with just one purchase. An index fund, for example, gives you exposure to all 500 stocks in the index.

Index funds can help you diversify your portfolio while also lowering your … Read the rest

Tax Implications for Intraday Traders and How Gains from Trading are Taxed LTCG or STCG?

Basics:

The stock market is second to none when it comes to investment, since many investors and traders actively participate in trading and profit from it.

There are two sorts of investors:

1.Those that keep stock investments for more than a year and report their earnings as LTCG (long term capital gains).

2.Those who keep equity assets for more than a day but less than a year are the second category of investor and report their earnings as STCG (Short term capital gains).

Every financial market has a variety of investors, each of which uses a different method to attain their financial objectives. As a result, each investor’s return on investment (ROI) may differ.

As a result, taxation on persons … Read the rest

Primary market IPO’s ? India IPO ‘s are increasing ?

The Primary Market:

It also known as the New Issue Market, is where new securities are raised and issued to the public for the first time. It is utilised by both new and existing businesses. For the purpose of raising long-term cash, the corporation issues additional shares and debentures. Securities are issued through the prospectus.

Businessmen, clients of the company, corporate workers, present shareholders, and others can buy new shares and debentures.

BENEFITS

  1. In comparison to the secondary market, there is less price manipulation.
  2. There are no brokerage fees, transaction fees, or other charges.
  3. It is unaffected by market movements.
  4. It contributes to portfolio diversity.
  5. Investors are given a share of the company at a certain price.
  6. It helps in
… Read the rest

Learn about the impact of FII- foreign institutional investments on the stock market

Today we will discuss about the impact of FII -foreign institutional investments on the stock market.

What is FII (foreign institutional investments)?

The term “FII” is often used among stock market investors. This is due to the fact that FIIs are entities that pool significant sums of money and invest in financial assets such as real estate, investment assets, and the stock market, among other things. Because they invest the majority of their money in the stock market, money inflows and outflows have a considerable impact on stock market movement.

When the stock market falls, several headlines appear in the news. For example, FII selling causes the Sensex to drop 1000 points. When foreign institutional investors (FIIs) withdraw their funds … Read the rest

Understanding the Stock market?

what drive the market?

Simple, buying and selling drives the market. no need to complicate.

Higher demand of stock and price goes up (more buyers than sellers)

Lower demand of stock and price goes down (more sellers than buyers)

what is bull market?

it is where Bulls are in charge that is a lot of buying taking place in market.

what is bear market?

it is where Bears are in charge that is a lot of selling taking place in market.

why do people give importance to volume?

Volumes are nothing but transactions taking place in the market like buying and selling. More activity can mean that there can be a price movement or price reversal.

What is more important

… Read the rest