Profitable deep OTM in BankNifty

21 May    Uncategorized
May 21

Profitable deep OTM in BankNifty

The positional options and futures are highly rewarding in the current market. As an example, take a look at the 15000 PE option in Indian Bank Nifty Currently, it is trading at the rate. To buy, this option, an individual has to spend INR 200, i.e $4 only. The market is already trading near 17000 spot prices. Any fluctuation of 1000 points in a downward direction would result in a change in price.

15000 PE 28th May Expiry Put Option

Similarly, on the other hand the Bank nifty option 20400 call is trading at the price of Rs5 i.e. less than 10 pennies. A spontaneous movement of 2000 points can be rewarding. The 2000 points change has become a norm these days. In summary, deep OTMs are highly rewarding if bank nifty spot price fluctuates between 1000-2000 points. This happens at least once or twice a week.

20200 CE 28th May expirty

A gap between ask and bid price determines which deep OTM to buy in such a scenario. Mostly any OTM that has a difference of 0 or less than .25 has a tendency to results into great reward. Why it is so? It is because it determines the interest between buyer and seller. If the gap difference is high, there is less interest. If gap difference is low, then it is likely most interesting option call or put.

Disclaimer: I do not provide any buying or selling calls. My work is based on personal research. You will be responsible for profit/loss from your own action.

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