The start of 2022 had been an interesting one. After two straight calendar years of bull market, 2022 was expected to be a bit tough. With inflation inching higher, clearly troubles were looming. That got accentuated by geo political, supply
Every business has a business plan and trading is also a business how many of you who are trading have a trade plan? The answer is 99 % traders don’t a have a written trade plan, now you know why
Option spreads is one of the most interesting strategies. It helps one play multiple factors in a go. For instance, if one has initiated a Debit Spread, the play of Delta remains intact while getting protection from diminishing Vega and
It is believed that stock price and in turn index levels are a reflection of collective intelligence of the market participants. Different participants view situations differently and also view a wide variety of situations. They input their thought process in
For last couple of years, buy backs have become extremely common. We see this extremely prevalent not just in India but across the markets in the world. So, what is a buy –back? Simply speaking, it is the company repurchasing
Covered call writing can be simple or complex, depending on your approach. Through the selection of the underlying stock to buy and the particular call option to Sell, the strategy can be tailored to a multitude of different risk levels and market conditions,
The concept of exchange traded contracts is based on the premise of standardisation, liquidity and elimination of counter party risk. Standardisation means having a lot size, a fixed number of shares in each lot (bunch). Liquidity means having enough buyers
Implied volatility is a force in itself. This means than an option contract could gain or lose value purely on the market’s changing expectation of volatility even if the underlying stock price doesn’t move at all.
There are not many
An option’s price is comprised of two major components. The first being the option’s Intrinsic Value or value should the contract be exercised/assigned right now.
For example, let’s assume you are long a 100 strike call option, which is
There are typically three types of participants in the market; speculators(traders), hedgers and arbitragers. Arbitrage is though not price impacting is very important to contain price impact. Arbitragers are crucial part of the market as they provide liquidity to the
Options come with a phenomenal advantage, one can create strategy which comes in handy in terms of capital commitment, risk appetite, view, reason of the trade, probability of success and so on. The interesting thing here, is that it creates
Data is the new oil, has become the buzzword for almost a decade now. We have moved from being a data starved to a data overloaded market. Infact, the problem now is how to cut the noise and understand things
Since 2014, we have seen great transformation the way individual investors were investing in the stock markets. There was a sharp institutionalization of investments that people did. Initially, what looked like a small wave turned out to be a tsunami.