Expiry Trading Strategy - Bear Call Spread for Consistent Profits

 Expiry Trading Strategy - Bear Call Spread for Consistent Profits

Introduction:

In this blog, we will explore an expiry trading strategy using the Bear Call Spread technique. This strategy will be applied on specific days for respective indices: Fin Nifty on Tuesday, Nifty on Thursday, and Bank Nifty on Friday. We will focus on deriving support and resistance levels based on the Open Interest (OI) data at the start of the day. By carefully selecting the strike prices for the options, we aim to achieve an 84% winning ratio and a minimum 1.5% profit on each trade, with a conservative target of 9% per month and 108% profit annually. Let's dive into the details of the strategy.

Expiry Trading Strategy - Bear Call Spread:

Selecting the Trading Days:

Tuesday: Fin Nifty

Thursday: Nifty

Friday: Bank Nifty

Identifying Support and Resistance Levels:

At the start of each trading day, monitor the Open Interest (OI) data for the respective index to determine support and resistance levels. These levels will help guide the selection of strike prices for the Bear Call Spread.

Understanding Bear Call Spread:

The Bear Call Spread is a bearish options strategy that involves selling a call option with a lower strike price and simultaneously buying a call option with a higher strike price. This strategy profits from a decline in the price of the underlying asset.

Tuning the Strategy for Higher Success Rate:

To achieve an 84% winning ratio, fine-tune the selection of strike prices for the options in the Bear Call Spread. Analyze historical data, technical indicators, and market trends to make informed decisions.

Using a Broker Application:

Execute the Bear Call Spread strategy using a reliable broker application like Upstox. These platforms offer advanced tools for options trading and can provide real-time data to enhance decision-making.

Profit Expectations:

For each trade, aim to achieve a minimum 1.5% profit on the investment. Considering three trades per week, the total weekly profit would be 4.5%. Over a month (4 weeks), the target profit is 18%.

Conservative Approach:

While aiming for 18% monthly profit, adopt a conservative stance, anticipating a 9% monthly return. Over a year, this would translate to 108% profit on the initial investment.

Blueprint for Compounding Investment and Trading:

Initial Investment: Start with 30,000 INR.

Weekly Profit: Assuming a 4.5% weekly profit, the returns can be calculated as follows:

Week 1: 30,000 + (30,000 * 0.045) = 31,350 INR

Week 2: 31,350 + (31,350 * 0.045) = 32,725 INR

Week 3: 32,725 + (32,725 * 0.045) = 34,125 INR

Monthly Profit: Assuming a conservative 9% monthly profit, the returns can be calculated as follows:

Month 1: 30,000 + (30,000 * 0.09) = 32,700 INR

Month 2: 32,700 + (32,700 * 0.09) = 35,643 INR

Month 3: 35,643 + (35,643 * 0.09) = 38,890 INR

Annual Profit: With a 9% monthly profit, the annual profit can be estimated as:

Annual Profit = 30,000 * (1 + 0.09)^12 = 108,241.16 INR

As per the below table, we need 42 months to reach from 30k to 1.5 cr with this Expiry hedge strategy.

Put-Call Ratio (PCR) scenarios:

In this representation, we've assigned a numeric value to each scenario to indicate the prevailing market sentiment and possible trading strategies related to the Put-Call Ratio (PCR). A positive value (1) indicates a bearish scenario, a negative value (-1) indicates a contrarian scenario, a zero value (0) indicates a bullish scenario and a value of 2 indicates a potential reversal signal based on PCR divergences.

Conclusion:

The Bear Call Spread strategy for expiry trading, when executed with precision and discipline, can yield consistent profits. By identifying support and resistance levels based on Open Interest data and fine-tuning strike price selection, a target winning ratio of 84% is attainable. Adopting a conservative approach to profit expectations, investors can aim for 9 /18% monthly returns and potentially achieve an impressive 108% or more annual profit. Remember that trading in the financial markets carries inherent risks, and it is essential to exercise caution, use risk management strategies, and stay informed about market conditions while implementing this strategy. Happy trading!

Special Discount Offer for Learning the Expiry Trading Program!

We are excited to offer a special discount for individuals, groups, and teams interested in learning our comprehensive Expiry Trading Program. Instead of the regular price of 90,000 INR, we are providing a limited-time offer of just 60,000 INR!

Here's what you get with the Expiry Trading Program:

In-depth Training: Our program offers detailed training on the Bear Call Spread strategy and other essential aspects of expiry trading. Learn from experienced traders with a successful track record.

Hands-on Practice: Practice implementing the strategies in real-time with practical examples and simulations. Gain confidence before putting your own money at risk.

Personalized Support: Receive personalized support and guidance from our expert instructors throughout the program duration.

Market Insights: Stay up-to-date with market trends and receive valuable insights to make informed trading decisions.

Risk Management: Learn effective risk management techniques to protect your capital and manage potential losses.

Trading Tools: Access to recommended broker applications and tools to facilitate seamless trading execution.

How to Avail the Discount:

Individuals: Register for the Expiry Trading Program at the discounted price of 60,000 INR.

Groups: Gather a group of at least three participants, and each member will receive a discounted price of 60,000 INR.

Teams: For teams of five or more participants, we offer additional benefits, including a dedicated team instructor and personalized training sessions. Please contact us for more details.

Don't miss this fantastic opportunity to learn and master the Expiry Trading Program at a discounted rate. Take advantage of this offer and propel yourself toward successful trading!

Limited slots are available, so act fast! To register or inquire about group/team discounts, please first do a message & accordingly call us at +91- 8976345801  after 8.30 pm only.

Happy trading and we look forward to having you in the program!

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