Options Study (Strangle)

Strategy1 - Its a short strangle strategy with 10% up and 10% down for low volatility but liquid stocks. Strangle means it should be range bound and non directional.

Some stocks suggested are: Reliance, TCS etc.. Which moves less than 10% per month.

Clearly could understand options selling has more benefits over options buying,.

Explored sensibull which looked to be a good tool for executing trading strategies.

Expect annual returns of 2-3X of FD. Which is approx 20% pa. Also have goal to make consistent and regular income and not one big trade. Probability of profit of the trade should be high.i.e. 80% or higher.

Question : Can we find direction from Options chain? Will need to explore this..

Span of a trade = 23 days Target return = 3-4% max

No Entry:

market vix > 25

if results coming - no entry

macro event - election, budget, war

stock events

Entry

Last friday of previous month post 2pm

First friday of new month 12 pm

Exit

Tuesday/Wednesday - close

have 10% of margins

Stop Loss:

If breached exit

first 15 days 3x of premium

last 15 days 2x of premium

Backtest: https://opstra.definedge.com/backtesting

Other stocks: infy, reliance, tcs, sbicards