F&O guide for May 27: Here's why analyst recommends this Nifty strategy

Sahaj Agrawal of Kotak Securities recommends a Nifty Bull Call Spread in F&O for the upcoming May 29 expiry.

Recommended Strategy

Strategy: Nifty Bull Call Spread

Expiry: 29 MAY 2025  Strikes: Buy 25,200CE and Sell 25,500CE  Net Outflow: ~85  Stop Loss: 30  Strategy Target: 200  Read Latest Stock Market Updates Today LIVE  

Rationale:

• Nifty has resumed its upward trend while it made a putative swing low on last Thursday at 24,462. 
• The re-ignition of the momentum in the broader markets, especially seen in the last couple of days, is inkling a potential to propel Nifty towards 25,500 levels. 
• However, given the prevailing volatility, a risk-limited Bull Call Spread is an optimal strategy. 
• It offers a favourable reward-to-risk ratio, aligning with expectations of a moderate upward move over the next few days.

(Disclaimer: This article is by Sahaj Agrawal, senior vice president, head of derivatives research, Kotak Securities. Views expressed are his own.)