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[Music] Hello traders, hope you're doing well. In this video, I'll be discussing with you a very powerful option buying strategy.
Now, this strategy requires
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only 30 minutes of your time. You will execute the trade around 9:30 a.m.
Maximum by 10:00 you will be closing the trade. So, there are many working professional who do not have time to spend in the market.
So at least this 30 minutes if you are able to spend you can take advantage of this strategy. Now
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second interesting thing about this strategy is you don't have to look at charts at all only based on the premium chart as per the rule whichever strike price is giving you entry signal you'll be executing the order in that particular strike price. Now the third advantage of the strategy is risk is
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less reward is more minimum with the strategy you will be getting 1 is to2. So you guys know if you take 10 trades even if the success rate is 50%, five trades you make loss, five trades you make profit but riskreward if it is more 1 is to two or more than that definitely
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you will be profitable if you calculate overall for that 10 trades. So that is one advantage.
Now this strategy was thought to me by one of my friend he he's having good success rate 70 to 75%. So 50/50 if you make profit only if
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riskreward is more it is good in this case is getting 70 75% on an average month-on-month basis even I started doing the back test for me success rate was good so I thought it would be very interesting if I teach you the strategy so that you can back test it at least
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for 1 month once you see the results if you're happy with the results then you can start using the strategy so that you spend very less time in the market so that is the whole idea I don't want to waste any further time. Let us just start with the rules of the strategy
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which is very very important. To get the success rate, you have to follow the rules.
Now traders, the first rule of the strategy is morning 9:25 a.m. You need to open Nifty's current expiry option chain data.
Option chain data
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will look somewhat similar to this. I'm using Sensible.
Whichever broker is providing you this information, you open Nifty option chain data for the current week expiry. Now once you open nifty option chain data at 9:25 you should not open at 9:15 920 no exactly at 9:25 you
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have to open nifty option chain data for the current week expiry now traders once you open the option chain data for the current week expiry for nifty what you will do first you will observe nifty where is it currently trading at as of now I'm recording this video after
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market closing to explain the rules to you I will give you one live trade example also So you see that you will get better understanding. First only rules we are going to follow.
So what you will do morning 9:25 a.m. Not at 9:00 9:15 at 9:25 a.m.
you will come and
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see current market price of nifty and then you will see which strike price is closer to the current market price. In this case 24,500 is very close to 24,485.
So this is our at the money strike
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price. Now the goal here is from 9:25 a.m.
If you observe on the call option side any one of the in the money strike price will be trading very close to 180 rupees. It can be trading at 165 170 175
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but one premium will be always trading very close to 180 rupees and that strike price will usually be in the money strike price. What you have to do?
You have to select that strike price. Now imagine market is open.
You will look at
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a call option strike price which is trading very close to 180. Here if you see 24,350 is very close to 180.
So this call option strike price you will choose. Same way what you will do in put option
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side definitely 99% of the time there will be one strike price which is trading very close to 180 rupees. So you will start seeing which strike price is trading close to 180.
Here you can see 24,650 strike price is trading at 172. So this
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is very close to 180. Right?
So this strike price you will choose. So basically what we have done on the call option side one in the money strike price we have chosen which is 24,350 because it is trading very close to 180
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rupees and on the put option side we will be choosing a strike price in this case 24,650 because this is trading very close to 180 rupees it's trading at 172. So these two strike price you will add to your
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watch list. So you will keep observing these two strike prices and this you have to start looking only at 9:25 a.m.
Please remember that. So we are getting ready for the strategy.
So what will happen is closer to 9:30 a.m. closer to
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9:30 a.m. Any one of this in the money strike price.
It can be either put option in the money strike price or call option in the money strike price. Any one of it will break and start sustaining above 180 rupees.
Either it
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can be call option or put option. Whichever breaks 180 price level first that strike price without thinking too much we will take entry.
I hope you have understood this. If you observe I've not looked at the chart.
I have not asked
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you to look at the chart also only premium chart we will see whichever is trading close to 180 rupees we'll keep observing either call option or put option whichever breaks 180 rupees and starts sustaining that strike price we
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will take entry now once we enter the trade at 180 rupees sometimes it can be 181 182 also but very close to 180 we have to take the entry now for this trade the risk is already decided. Okay,
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imagine you have taken a call option. It was trading at 180.
As soon as you saw that around 9:30 a.m. you executed the call option trade.
So this strike price as soon as you enter immediately you will place the stop loss. The stop loss
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for the trade will be 20 points. Okay.
So if market is trading at 180 if you keep stop loss of 20 points then what time you have to exit? If market goes to 160 after you take entry at 180 rupees
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immediately you have to keep 20 point stop loss. So by chance this 24,350 strike price from 180 if it goes to 160 without thinking too much you have to close the trade.
Now traders, you might have a question. You might ask me, sir,
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why are we choosing a strike price which is very close to 180? The first reason is almost all the time whichever strike price is trading near 180 price level.
This will be an in the money strike price itself. So in this case 24,350
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it is an in the money strike price on the call option side. Right?
We will be choosing an in the money strike price which is very close to 180. One advantage we have by choosing in the money strike price instead of at the money strike prices the delta value you
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can see the delta value of this particular strike price will be more than at the money strike price. As per my observation, my back test, as per the data what I've got my from my friend, when we choose a strike price which is
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trading near 180 and we take entry as soon as it breaks 180 that is giving us very good success rate because delta is kind of more than at the money strike price. So by chance if market quickly starts moving let's say nifty moved up
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by 10 points since it is in the money strike price and delta value is more the strike price will at least move by 7 to 8 points. Okay so our goal is to capture quick momentum in the market 15 to 30
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minutes maximum. We are going to enter a strike price which delta value is kind of high.
Usually, we will choose a strike price which is currently trading at 180. We will be executing the order at 9:30 a.m.
Now, once we execute this
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order, our entry is at 180. Stop loss will be 160 and target will be 220.
This will be the minimum target for the trade. So, if you calculate as per the riskreward ratio, stop-loss is 20
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points, target will be 40 points. This is the maximum risk but this is the minimum profit.
Now sometimes after you enter the trade I have noticed six to seven times I would have kept minimum target as 220 but market will be very
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quick and it can reach 260 270 280 also. So that additional move whatever you get that is your bonus.
If you are able to capture it you can capture. If not at 1 220 price level, you can exit from the
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trade. As a beginner, when you're doing the back test, your riskreward should always be the same.
Risk is around 160 price level. Entry is around 180, target is 220.
So after you do the back test, keep observing how many times market has
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gone above 220. It is sustaining about 220.
Then you will get better idea as to if you hold on to the trade you will have a chance of making 1 is to 3 1 is to 4 1 is to5 also many times this has happened traders by now you know we are
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going to execute the trade at 9:30 a.m. Whichever strike price on the call option side or put option side whichever is breaking 180 level first we'll be entering a trade in that particular strike price stop loss is 20 points so
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stop loss will be around 160 target will be when that particular strike price goes to 220 1 is to2 is the riskreward now in this particular trade to get good success rate you don't have to wait too long if the market needs to give you
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profit by 9:45 a.m. itself most of the time it will give you profit.
Okay. So basically 15 minutes within that 15 minutes either we are aiming for 220 or we will be taking a stop loss near 160
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entry is near 180 level. Either we stick to 40 points target or we exit at 20 points stop loss.
Most of the time as a beginner I would suggest you to close the trade at this time. Now by chance at
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9:45 a.m. Let's say market did not reach 220 also.
It did not go and hit your stop loss at 160 also. That time as a beginner what you need to do is without thinking too much either you will be,500 2,000 like that profit at 9:45 you have
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to exit from the trade or maybe you will be seeing a loss of,00,500 whatever it is that stop loss you have to take and close the trade. For majority of you at the beginning stage at least do not hold on to the trade for more than 15 minutes.
Entry is at 9:30
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a.m. exit at 9:45 a.m.
But once you gain experience, what you will understand is you have a chance of waiting until 10 a.m. also.
But you will be do doing that only if your position is in profitable
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situation. For example, you entered at 180.
At 9:40 a.m., let's say market is trading somewhere near 190 or 200 level. Only 20 points profit you got.
That time what you will do? You will trail the
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stop loss. Where is your stop loss?
Stop loss is at 160 rupees premium. Right?
So, you will bring your stop loss to 180 which is cost to cost and then you will hold on to this trade. So either market
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will hit 180 level or it will hit your target of 220. Until then you have to wait.
So by doing this what what you have done after 9:45 a.m. If you're not reaching 220 target you are bringing
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your stop- loss to cost to cost. So this trade becomes a risk-free trade for you.
By following these rules, we have seen 70 to 75% success rate in the strategy. If our trend is correct, if market also
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wants to move that way since we have taken 180 strike price which is usually or always will be in the money strike price, we might be able to achieve our target very quickly. At the same time, we will be able to get more targets
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also. I hope you're getting the point as to why we are using 180.
As per the back test, that particular strike price compared to other strike prices is reasonably priced. At the same time, delta value also is reasonable.
That is why we are choosing the strike price
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when we tested the strategy based on 180 premium. That is working out well.
That's why I'm suggesting the same premium levels for you. Whichever strike price is trading at 180 rupees at 9:30 a.m.
we need to execute the order and
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take the trade. Now you will be seeing a live trade which I took today itself 12th of August.
Look at that live trade. You'll get better understanding.
But please after looking at the strategy quickly don't put your hard-earned money in the market immediately and start
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trading from the next day. Please don't do that.
back test for 30 days only if you're getting a result as per what I have told in this video then you take the trade okay from many days I wanted to give the strategy it was pending I have given now now you know the strategy
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if you see the live market example you will get better clarity if you have any further doubt related to the strategy please mention that in the comment section we'll look into it and we will try our best to answer not just this live trade at least four to five more
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live trade examples I'll be sharing so that you will come across all kind of situation using this strategy. All right, for me it's worked out.
I've shared with you. You can now see the live trade which I took and then decide if you're ready to back test the strategy for the next 30 days.
Okay, now
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traders before you see the live trade example, you can see 8th of August in the group I had discussed saying that these two are the strike prices I'm looking at based on 9:30 a.m. strategy on Friday.
We got very good profit in the strategy. But on Monday, my stop loss got hit.
Okay, as per the strategy,
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Tuesday trade is what you will be seeing right now only because that is the one which I have recorded. Whenever you are having confusion about which strike price to choose and things like that, whenever I'm looking at the strategy definitely I will share.
So if you're interested, you can join the group. Now
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let's look into the live trade example. Tra's date today is 12th of August.
As of now time is around 9:26. Now at this point of time market is trading somewhere near 24,600 range at the money strike price is 24,650.
When I notice there are two
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strike prices. One is 24,500 which is trading very close to 175 range and I have a put option which is 24,750 which is trading near 166 range.
So my idea as of now is to add these two
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strike prices to my watch list. Why I do this?
because they are very close to 180. So I'll go here.
Simply what I will do? I will add this position 24,500 call option.
I'll add this to my watch list. And then which strike price we
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had? 24,750.
So 24,750 put option I will add. Both are for the current expiry itself.
Now once I add these two stack prices, I will observe these charts. Time as of now is 9:28.
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Now whichever strike price close above 180 I'll be looking for an entry in that particular strike price. 24,750 put option is currently trading at 168 and 24,500 call option is trading at 170 to
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173. So whichever strike price sustains above 180 then I'll be taking trade in that particular strike price.
Now as of now both are trading at somewhat similar range itself. Basically we need to execute this order by 9:30.
So by 9:30
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9:35 maximum whichever strike price sustains above 180 zone we'll be taking that particular strike price. I think put option is kind of spiking up a bit.
So little bit I'll be ready to place an order. Usually people will set trigger
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orders for the trade but uh I'm not doing that right now. I'm just going to place market order itself.
So I I'll just observe 180. If this breaks, I'll enter 180.
If this one breaks again, I will enter. So call option has broken 180 zone.
So I'll be taking some
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positions there. So somewhere near 180 I have got the trade and my stop loss will be just 20 points.
Somewhere near 160 zone and target maybe we can try minimum as per the rule 40 points is the target. So our idea is to hold on to this trade
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until 9:45 and uh by that time if market achieves our target without thinking too much we will be closing. Okay that's the plan.
As of now there is indecision between the buyers and sellers. Call option 24,500
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is still holding on sustaining at the same price level. So quickly another 40 points from the current zone if we get we will try to capture that and close the trade.
Just for the reference point very less quantity only I have taken around 300 but at the initial stage I
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will suggest people to trade with very very less quantity or please do paper trading. There are many platforms you can go there do paper trading do it for at least one month only if you get confidence you're happy with the setup then maybe you can take the trades that
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too you can you have to start off with very very less quantity so real market condition instead of giving the strategy how it actually works that is what I'm trying to demonstrate to you guys here so basically the riskreward for this trade if you have entered at 180 zone
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then 220 is 40 points target 160 zone is 20 points risk. That is what we are currently aiming with the strategy 1 is to2.
So in this 1 is to2 riskreward. Let's say 5 days you made profit.
Four five are 200. So 200 points you'll be
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able to capture. 5 days you lose also you'll be losing 100 points.
100 points net to net. How much is 100 points for one lot?
75 into 100. So close to 7,500 rupees per lot is the minimum expectation that we have with the
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strategy. Okay.
If you increase the lot size, your profit also will increase. That is a different story.
Basically, every time you target 40 points. This is the minimum profit that you can make.
Sometimes what happens is instead of giving 40 points, it will give you 60 points, 80 points, 100 points moment.
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Because in this we are not looking at charts or anything. We just executing the trade based on the strategy and we'll be closing the trade also by 9:45.
That is how the strategy works. Sometimes me holding on to the trade post 945 it has given good profits also.
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At the same time there are some losses also. So net to net at the initial stage for this strategy the idea is to close the trade by 9:45.
At 9:30 we need to execute. 9:45 we need to exit.
So the trade timeline is just going to be 15
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minutes. So working professionals if you look at the strategy back test for one or two months and if it's working good for you simply you can implement this in your daily trades.
But whatever it is risk is involved without doing back test without you getting confidence. Never
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ever jump into any trades which anyone suggest because there might be some days continuous 4 days 5 days you will get loss. So to get a proper feeling definitely back testing the strategy for at least 1 month is important so that you will come across all kind of
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situation. Time as of now is 9:39.
This market has not given us any kind of movement. So based on the strategy at 9:45 wherever market is okay you ideally have to close the trade.
It might be at 1,000 rupees profit 2,000 rupees loss
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without hitting the stop- loss. Market can just be sideways.
That time you might have to close the trade. Okay, that is the basic rule.
Another five more minutes we will wait and observe if market is either giving us the target stop-loss or it is just trading within a
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range. Based on that situation, we will decide what to do next.
As of now, we are just at cost to cost. Okay, no big changes in the setup.
Already time is 9:42. So as of now, slowly we are getting the spike.
Usually what happens by 9:35 only you'll get profit or 940
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you will get profit. So by then if it reaches 120 zone whatsoever you might have to close the trade.
Now though it is 943 still market only now it has come to the profit situation. Now how would the market sustain all of those things
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post 945 you should not think as per the rule at 9:45 you have to exit. But sometimes let's say you are in profit situation and you're okay to take the risk then from 160 level you can get
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down your stop loss to as much as possible. Let's say you in this case I get it to the previous candle 175.
Okay. So from here if trend continues I will capture good moment.
In case not I will exit the trade without thinking too
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much. Okay.
I hope you're getting the clarity. We have not got very big premium movement.
Just as of now if you have entered at 180 190 10 points profit you have got. Now simply what you will do you will trail your stop loss to the maximum at whatever price you want you
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can exit. Since target is 220 market is going as per the view you want to hold means you can hold.
In this case maximum from 20 points risk we have reduced it to five points. At any time we want we can book but those who want to stick to
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the target I'm just saying this is one of the situation which you can follow. If you have entered at 180 market has reached close to 200.
So 20 points profit already you have got. You want to trail the stop loss to cost to cost or
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you leave it as it is is entirely up to you. when you're seeing market at 9:45 market is not showing any positiveness or 50% 60% of your stop loss already the market has taken that time maybe you can
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decide not to hold on to the trade and things like that so profit had gone close to 5,000 rupees also basically we should have at least closed the trade when around 9:45 but just holding on to the trade what happens by reducing the risk that is what I'm trying to
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demonstrate to You guys here it is time as of now is almost 9:50 a.m. As of now net to net this strategy has just given us today 1 is to1 profit itself.
By this time you should have trailed the stop loss to cost to cost so that today it
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just becomes a risk-free trade for you. So what I would suggest you to do is trail the stop loss okay to 180 zone.
So this becomes completely a risk-free trade.
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Trader time now is 9:53. Basically at 9:45 itself whatever profit we got or whatever level market is without thinking too much as per the rule we need to exit.
This I'm saying for beginners okay people who wants to hold on to the trade simply what we have done
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here we have trailed the stop loss to almost cost to cost here 180 zone. So this becomes a risk-free trade.
If it is a risk-free trade, you're holding on to the trade, then to a certain extent your capital is protected like the trailing you can do. This is one of the
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situation. But the initial stage, I would suggest people to book whatever profit is there around 9:45.
But when you keep doing the back test right, when you get the direction right, most of the time what will happen easily market will give you the target that you want. So
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you have to just wait and see. But at the same time you cannot keep your stop loss at 160.
You have to get it to in this case you see I got it to 180 zone so that this becomes a safe trade for us. Market has taken its own sweet time
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to reach the target zone. So 220 is basically our target area.
But since we are holding on to this trade for too long you can trail the stop loss so that it will become a profitable trade for you. After this if market sustains the
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upper level fine if not we have trailed the stop loss to maximum so we will book that and go. Many people what I will suggest is okay switch to 1 minute time frame and simply you can keep trailing the stop loss to the previous candles like this and you can go if this candle
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goes above 220 you can get your stop loss here like that when you do maybe to a certain extent whatever profit you have made you will be able to hold it. Time now is 9:56 another 4 minutes for this candle to close.
So here you can
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take a call. Okay, market has reached 90% of my target only four points pending.
Should I exit or not? That you can decide.
Now in this case you can see this candle is there. Market is trading little above that candle itself.
What I
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will do? I'll trail my stop loss below this previous candle.
So no matter what I will be getting around 31 points in this trade. If market sustains above this level, fine.
If not, no. Almost 220 market reached.
So we will trail the
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stop- loss to this candle. So by now target has achieved.
Sometimes market takes more time as per the strategy you guys know right. 220 is the target zone.
We will fix that soon right now. So next market has given support to 225.
So you
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trail your stop loss little higher. Just modify that and go.
Almost market has come to our trailing stop-loss area. It's not yet hit.
So if it hits we will exit. As of now for 300 quantity we are at 13,000 profit.
That is fine. Now if
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markets gives a breakout above this zone then what we will do? We will trail our stop loss little more.
So target was uh 220 but we have got 240 also. Now you can see market is continuing towards the upside.
Now how muchever maybe 50% of
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this you can trail the stop loss and keep this is a big candle right what usually you can do is this candle whichever breakout candle is there little near 618 little below 618 level if you place the stop loss then in case
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there is a pullback also still you will be in this trade as of now this just going simply what we will do we will trail the stop loss little more now what happened the stop-loss got triggered entered in this trade. So this order got closed.
So the profit what we made was
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around 17,000. Target was around uh 220 but market gave moment up to 240 245 also.
I hope you have got a basic idea of how this strategy works. Let's say you had kept the stop loss near 618 level then stop loss wouldn't have it.
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If continuation would have happened additional moment you would have been able to capture. This is a good scenario where we made good profit but as per the strategy if you stick to 9:45 a.m.
Based on that you do back test. Okay.
After
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that you close the trade and keep looking at the market. How many times after 9:45 additional moment it will give.
Most of the time you will be capturing like I said right 60 points 100 points also in the strategy when your position is right and market trend
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also is right. But charts and all we should not be looking at that much.
I hope you are understanding this. Now traders I hope you have understood the potential of this strategy.
Now my suggestion to each and everyone of you is from my end I've given you the
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strategy not necessary that you have to trust me all you have to do is back test the strategy for minimum 1 month based on that results if you really want to put your hard earned money in the strategy or not that you decide one or
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two days continuous losses you can make that time you should not get disappointed you have to do the back test for one whole month put it in an excel sheet see the results then you come to a decision going forward many examples related to the strategy I will
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give you so you don't have to worry about that so I hope this live market example was useful for you back test and in the comment section let me know after 1 month what kind of results you got with the strategy more videos related to the strategy there might be some complications related to the strategy
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for example let's say when you're looking at the strike prices right very closely both the strike price will be moving. One will be at 178, one will be at 179.
You are closely watching the strike price. Whichever breaks 180 zone immediately in that you have to enter.
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Okay. Stop loss is 20 points which is at 160.
Target is 220. So 1 is to2 riskreward is the thing for this trade.
I hope this video was useful. If you enjoyed this content, support the channel by liking the video.
If you want
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more examples, more live trades that I take based on the strategy also let me know so that you will also come across different scenario. And also if you wish I can make a playlist of the strategy where I take all the trades, all the profits, all the loss based on the
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strategy. I will put it in one particular list maybe 10 to 15 videos that might be useful for you.
That is about this trade traders. And that's it.