Derivative strategy for Bank Nifty: Motilal Oswal

Here is the derivative strategy on the Bank Nifty from Motilal Oswal

Option Strategy:


Bank Nifty: Call Ratio Spread

Buy 1 Lot Jan 15500 CE   ell 2 Lots Jan 16000 CE

Target Profit: Rs 4500           

Stop Loss : Rs 1500

 

Rationale: Short covering in 2 out of last 3 sessions indicate pull back could be in offing. The respite may pull the index up, which is indicated by highest open interest  in 15000 Put. Since the trade is aiming at trading the pullback, Call Ratio spread is recommended.

Disclaimer: Motilal Oswal Securities ( MOSL ) is regulated by the Securities and Exchange Board of India ("SEBI") and is licensed to carry on the business of broking, depository services and related activities.Motilal Oswal Securities Limited is registered under SEBI (Research Analysts) Regulation 2014 SEBI Registration No :-INH000000412.MOSL, the spokesperson or his relatives, do not have financial interest in the securities mentioned above. The spokesperson has not served as a director, employee or officer at the subject company in the last 12 months. MOSL or its associate might be involved in market making for the subject company or have potential conflict of interest.

Shubham Agarwal is a head of Quantitative Research, Motilal Oswal Securities