Business Standard

Here's a Bear Spread strategy for Nifty Bank index by HDFC Securities

Short term trend has turned negative as Bank Nifty has closed below its 5 and 20-day SMA

Bank Nifty has broken down below the upward slopping trend line
Web Exclusive Premium

Bank Nifty has broken down below the upward slopping trend line

Nandish Shah Mumbai
Bear Spread strategy on Bank Nifty (Expiry 06 August)

Buy Bank Nifty 21500 Put at Rs 386 & simultaneously sell 21000 Put at Rs 215
 
Lot Size 25
 
Cost of the strategy Rs 171 (Rs 4275 per strategy)
 
Maximum profit Rs 8225 If Bank Nifty closes at or below 21000 till 06-August expiry.
 
Breakeven Point Rs 21329

Rationale:

Short build up is seen in the Bank Nifty Futures’ where we have seen 28% (Prov) rise in the Open Interest with Bank Nifty moving down by 2 per cent.
 
Bank Nifty has broken down below the upward slopping trend line, adjoining the lows of

Don't miss the most important news and views of the day. Get them on our Telegram channel

First Published: Jul 31 2020 | 7:59 AM IST

Explore News

To read the full story, subscribe to BS Premium now, at just Rs 249/ month.

Key stories on business-standard.com are available only to BS Premium subscribers.

Register to read more on Business-Standard.com