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Another Strangle: 38% this time


Continuing a strangle strategy: A strangle bought two days ago – when the index was near 4100, a figure too close to comfort from the 4210 closing last expiry – yielded a 38% profit today. A 4000 put and 4200 call were bought at a premium of Rs. 67 each – a net premium of Rs. 134 – or Rs. 6700 per contract.

Today the Nifty is around 3870, and the effective premiums were 167 (put) and 19 (call). A net sell value of Rs. 186, which translates to a 38% return in a couple days.

There’s probably mood for one more of these, should the nifty come back close to 4200.

Note: This is not portfolio advice. I was willing to lose 100% on the trade, remember that.


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