Live Option Strategies – LONG STRANGLE – Expected Rise in Volatility on Election Expectations has given a profit of 21.95% in the Option Strategy.
April 2014 Nifty 6800 Call Option Premium has reached Rs.92. Implied Volatility of 15.87%.
April 2014 Nifty 6200 Put Option Premium has reached Rs.8.7. Implied Volatility of 22.23%.
Total Cost for the Strategy for 1 lot of Put and Call Options was equal to Rs.82 multiplied by lot size equal to 50 is Rs.4100. Current total price of the Options has hit the target price of Rs.100 that gives a profit of Rs.18 multiplied by the lot size of 50 is equal to Rs.900 for the strategy. The Strategy has given 21.95% return.
Volatile Market has given movement in the direction of 6800 Nifty levels. The total call and put option premium had reduced to levels of Rs.53 at which we had advised to hold on to the strategy or take fresh positions for the target of Rs.100.
The total premium of Call and Put Option taken together has increased beyond Rs.82 till Rs.100 for a return of Rs.100-Rs.82= Rs.18 multiplied by the lot size of 50. Total Gain is equal to Rs.900 that returns 21.95% for the Strategy and the target has been achieved.
