Creating your own option strategies

Create and Analyze your own Option strategies - How to Use

In this blog I am going to explain how we can use this application to create your own option strategies.  Depending on market condition you can take a call which option to go for.

1. Go to optionstrategy.co.in and click on "My Strategy" button.
2. Under Index/ Stock, select one of the instruments that you want to play with.
3. Then select the script. The example that is demonstrated here is with NIFTY. The strike prices associated with it will be populated under Strike price combobox. 
4. Select the valuation date by clicking on the calendar icon button. This date should be less than or equal to the minimum expiry date that you are planning to use.

5.Now select one of the Option types. If you have selected Index, then you can select one of Call, Put or Futures. If you have selected stock, you have the option of selecting stock also.
6. Once instrument type (Call/ Put/ Futures/ Stocks) is selected, select one of the strike price. To get more reliable results, prefer liquid strike prices. Generally 3-4 strike price above and below spot price is liquid. For stocks, the criteria narrows further.

 

7. Select buy or sell.

8. You can change the expiry date if required

9.  Enter the price that you think you can buy or sell the instrument. Currently the prices are based on End of Day prices. You can also enter the price that you have entered in the strategy earlier.

10.  Select number of lots you want to trade with.

11.  You can select other call or put option, futures or stocks with different parameters in other lines.

 

12. Now click on My strategy button.

13. You can see a chart appearing below showing how the pay off graph will look like.

 

14. You can get an idea around which range your profit or loss will begin. 

You can create your other such strategies depending how you perceive the market. 

You can change valuation date and see how your pay off strategy will look like within short time frame.

Note- The values displayed are for approximation purpose only. they don't show accurate results because of market forces. With change in option moneyness, implied volatility will change and it will affect the option prices.. 

 Mail us your queries/ suggestions at info@optionstratgey.co.in

 We would be happy to help you.

Happy Trading!!!!