Directional Bank Nifty Option Selling Strategy
agadmin2024-12-06T10:46:27+00:00One of the most popular options trading strategies is the 920 short straddle. However, what many traders don't realize is that over 75% of its profits come from trades where a one-sided stop loss gets hit. The reason behind this is that we short both call and put options with a minimal stop loss. Once one side gets hit, we exit with a minimal loss, and the other side tends to decay as long as the market moves in a one-sided direction. But, this strategy can be turned into a directional option selling strategy by placing trades on only one leg with a fixed stop loss. This can be done by analyzing option data and figuring out which leg has a higher probability of hitting stop loss in advance. For example, if Bank Nifty trades at 35000, and we short 35000 CE and 35000 PE as per the 920 short
