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Sahaj Agarwal of Kotak Sec says 'Short Strangle' ideal choice for Nifty50

Nifty Today: An overall improvement in market breadth over the last week suggests limited downside capped within 22900

Stock Market, BSE, NSE, Nifty, Capital

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Sahaj Agrawal Mumbai

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Nifty Strategy: Short Strangle (13FEB2025 series)
 
Strategy Details:
  Expiry: 13FEB2025
  Strikes: Sell 22800PE and Sell 24000CE
  Net Inflow: 18
  Stop Loss: 36
  Target: Entire Premium Inflow
  Rationale:
  >> There is an improvement in the overall market breadth over the last week, suggesting a limited downside capped within 22900. On the higher side, 23800 remains crucial and might take some time before it is breached.
  >> Given this setup, the market is likely to consolidate within this range, making a Short Strangle strategy an ideal choice to capitalize on time decay (Theta decay).
 
  >> This strategy offers the potential for profits if the market remains range-bound along with a contraction in Volatility and Theta decay.
 
Disclaimer: Sahaj Agrawal is Senior Vice President, Head of Derivatives Research at Kotak Securities. Views expressed are his own.
 

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First Published: Feb 11 2025 | 8:54 AM IST

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