I've dabbled in covered call trading before. It can be lucrative, but if not planned well, it could lead to significant losses, especially in a volatile market.
Plus, considering the current global economy, it's essential to be cautious. Economic downturns or geopolitical events can greatly impact the effectiveness of this strategy.
The problem is that you don't have the knowledge needed to succeed in a challenging market. Only highly qualified professionals who had to experience the 2008 financial crisis could hope to earn a high salary in these challenging conditions
Recently, I've been considering the possibility of speaking with consultants. I need guidance because I'm an adult, but I'm not sure if their services would be all that helpful.
Well, there are a few out there who know what they are doing. I tried a few in the past years, but I've been with Desiree Ruth Hoffman for the last five years or so, and her returns have been pretty much amazing.
I think the concern is traders won't be getting a consistent return on that. We will need to be okay with not couple of months but couple of years of drawdown. Smallcap index was underperforming from 2012 to 2018 & the CAGR in this period was not above 20% The benefit of trading is we will. ideally be able to generate a consistent return of 24% or more.
You think that the smallcap rally will continue? Smallcaps have performed good in the 5 year window before that it was heavily underperforming. Smallcaps will not consistently give you 24% CAGR if the market crashes small caps will crash 4 times as much as the large caps.
April was indeed haunting as an option seller. All Nifty Expiries went in loss. Option spikes have destroyed intraday selling. I am thinking to not even do positional. I mean what is even the point now? So much hassle for what? 20-30% a year. I feel it’s just better to identify good stocks and try swing trading.
00:01 Retailers are finding it challenging to make money due to increased volatility in the market. 02:06 Unexpected market jump caused significant trading losses 04:06 Increased competition in option selling leading to diminishing profits 06:19 Large institutions can trigger stop losses by moving prices strategically. 08:42 Jane Street - a hedge fund with $300 billion under management, $15 billion used for trading. 10:49 High-speed trading gives big players huge market manipulation opportunities 12:57 Adapt your trading style to changing market conditions 15:04 Adopting 1 DTE or positional trading for diversified and fully hedged index trades. 17:22 Implementing a stress-free trading approach with limited losses. 19:29 Utilizing small opportunities to make incremental gains in trading options.
I appreciate your work, but I think in this low VIX environment with low intrinsic value of options, you should some times step out of option seller shoes and try to be option buyer, deep in the money option with delta = 1, will give good returns with a directional bias. There is a perception that option prices melt like ice cream, but with low IV's not Ice cream, we can compare with pastry cake. I also think that most of the Market movements happen 1 hour after opening and 1 hour before closing, having positions in the market all the day will not help. Most of spikes in the market happen in the middle of trading day, the Jane street guys will collect the data based on open positions and attack.
if your target is to earn 2% a month i’ll suggest you to do monthly calendar trade and hold it for whole month… it’s really stressfree and you’ll be getting success around 8-9 times with 3-6% profit making it more than 2% a month avg
Problem with far otm sellers is that they try to earn 2rs risking 4 or even 5 rupees. Making 2 rs is still easier with atm or near otm options. Positional will always work because ultimately it boils down to fundamentals and economy. With little bit of technical knowledge and sense of market direction, making 10% a month is also easy game. I earned 132 points in expiring sensex and 64 points in nifty today. This wouldn’t have been possible in far otm.
Thank you.bro Same I also lost entire 25 k previous month profit only in 3 trading days in april option selling. Now changed to positional far away instead of expiry day
I stopped trading the current expiry and shifted monthly or next month options only. April green for me.. and it's giving me so much peace... Because the next OTM options are less Vega, and not move much. I do directional trading
its called STOP LOSS HUNTING, i see this often in US markets as well, its a software that FII uses to track all Stop Loss and then bring the price to that level, it happens all the time in Forex markets in America, i'm now seeing this in India now since 2024, bad times ahead, change your strategy every couple of months, Stop Loss Hunting WONT STOP, even if you place your stop loss far far further, they use Price Spike which saket is explaining
its called stop loss hunting which FII do it quite regularly in US markets, they are using the same software which they use in America, I see this quite often in US markets as well
As you said markets behaviour have been changing which means backtest is useless and foolishness and trading is gambling that's fact. Only risk management will reduce loss or it may help to make profit. The fact is sellers can make 2% only because the risk reward is 1:1. To make more profit we need 1:2 risk reward with 50% probability of profit. This payoff no buyer or seller will get. If we make 1:2 spreads, the pop will be 33% which is equal to 1:1 RR with 50% pop. We can not beat mathematics
Hi Saketh please answer to this... When there is sudden spike.. in fintarget also, is there possibility of missing stoploss hit. In this scenario if we set overall MTM stoploss, will it hit without missing
Do you adjust your position once it reaches breakeven or when it reaches a particular strategy reaches some % of the loss let's say we execute 1000 points away on both sides 48200pe at 90rs premium and 50200 Ce 90 then the overall premium will be 180 rs. if we wait till the break-even to adjust the position one side's premium will reduce by 90 to 30 rs but on the other side it would be 1000+ points then the loss will be 8 to 10 times then the defined profit and if we start the adjustment for a weekly option close to exp. we do not get a premium to firefight. If we put SL as you told it hunts the SL. Please explain how to manage when we do weekly options
Very useful. Can you make a video on Stocks Future buying for Investment in Nifty 50 stocks month on month and sell by hedging of Nifty or Bank Nifty or any other stock if seems in down turn (and how to decide its down turn)
From what i see in the past 1-2 years markets can fall 1-2% easily in no time resulting in huge spikes in put options. But I have never seen call options spiking like put options. Short covering is definitely possible but that happens slowly and chances of slippage is almost 0.(correct me if I am wrong). Why can't we simply sell call options on 0 dte which are 1-1.5% away from the spot price? @saketh pls reply need your inputs on this
If stoploss come then take it i take 16 trade per month with 1:1 rr targeting 2 percent . Imake profit in 11 trade losing 5 making an average of 10 percent per month 😊😊
It’s not worth doing just for 18 to 24 pc annum. The mistake is that we all stick to one trade practice and showing over confidence finally getting the SL hit. The moment you see one or 2% profit, just exit. Don’t wait for it become 0 . You never know where spikes will come. I’m doing in stocks positional although very small qnty, but making 7 to 8 pc per month without headaches
I don't agree with u that age old methods are not working. I am using some strategies for last 3 years & today also they are giving good returns. Important is risk management & consistency. Why retail traders don't make money is because of these 2 things
What about crude oil , natural gas, gold, silver , stock, currency... can't we do option selling there..... diversification is what is needed in trading for lower dd
Hi saketh, whether the first stock broker is allowing 100% collateral margin for positional trading without any intrest. But zerodha need minimum 50% cash for positional trade. Could you please confirm form first stock how will be
