 "Apollo Hospitals")
Derivative Strategy
BULL SPREAD Strategy on Apollo Hospitals
Buy Apollo Hospitals (28-August Expiry) 7,600 Call at ₹175 and simultaneously sell 7,800 Call at ₹104
Lot Size: ₹125
Cost of the strategy: ₹71 (₹8875 per strategy)
Maximum profit: ₹16,125 if Apollo Hospital closes at or above 7800 on 28 August expiry.
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 "Apollo Hospitals has been investing big in infrastructure and bringing in advanced technologies such as Proton Therapy for cancer treatment, which has resulted in a higher debt")
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 "Apollo Hospitals")
Breakeven Point ₹7,671
Risk Reward Ratio: 1:1.82
Approx margin required: ₹33,000 ALSO READ | Monthly stock picks by Motilal Oswal Financial Services: HDFC Bk, LT Foods
Rationale:
➢ We have seen a long rollover in the Apollo Hospitals stock. This is indicated by an increase in open interest (OI) of 17 per cent, with a 0.60 per cent rise in the price.
➢ Short-term trend is positive as it is placed above its 5, 11 and 20 day EMA.
➢ Stock price has broken out on the daily chart with higher volumes.
➢ Momentum indicators and oscillators are showing strength in current uptrend.
(Disclaimer: This article is by Nandish Shah, senior technical/derivative analyst at HDFC Securities. Views expressed are his own.)
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