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Index Option Selling
Uses below things mainly for this
Index Option Selling
Uses below things mainly for this
- Open interest in the option chain.
- How the markets are moving worldwide.
- What are the current news at the world and India level.
- Keeps an eye on monthly data like Inflation, IIP, Auto Sales etc.
- Uses technical analysis like Moving Averages, Fibonaaci retracement etc for guessing how things may move.
- Uses lot of his past learning and understanding also.
- Trades short straddles mostly.
Expiry Day Options Trading
- Sells OTM options on expiry day in massive quantities.
- Plays Straddle one day prior to expiry to capture the Theta decay.
Results Options Trading
- Before results time the volatility of options rises a lot.
- He sells options by guessing where the stock could move to capture the fall in option premium once results are out.
Covered Calls
- For the stocks in his portfolio he keeps on selling calls to make rent out of the stocks he already owns.
Cash Secured Puts
- Sells OTM puts in good stocks with the hope that stock won't fall below that price.
- Is ready to buy the stock if it goes below a certain price.
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