I am assuming you are aware of the basics in terms of margins etc when it comes to futures. Futures trading is based on temporary trends and is time bound. It gives you ability to bet on a larger quantity of a stock without having to shell out the entire amount. For eg for 1000 TM shares (1 lot size in Futures) you need 274000 while in futures you need about Rs.70k which is called the margin amount. The margins change daily based on the changes in the price of the stock. There are various strategies one can follow to suit ones style and parameters. A simple way would be to buy 1 lot in anticipation of upward price movement or sell 1 lot if you expect the price to fall. Or, you could be holding 1000 TM in cash and decide to short 1 lot of futures if it has run up quite a bit. I am quite a novice to give you any further inputs.
in case anyone is interested, just thought of following up on my initial trade strategy in TM and this is also related to another post on this board about writing options: I started the month with +2 * FUT @ 265 levels, +1 * 280 CE @ 4.75, -4 * 300CE @3.2 & +1 * 250 PE @ 3. What I have experimented, and I will share it in an excel later offline if anyone interested, is when I do nothing on this trade till expiry whats the net result v/s what happens when I keep booking profits at regular intervals by tracking just the bollingers. Although expiry is still 14 days away I have got some interesting learnings. Maybe with some help I could refine this to increase profitability. With no change as on date I am sitting on 26k profit, but being the restless creature that I am, I did tinker around and booked profits regularly and my actual position has changed quite a bit now and my actual picture is 23k booked profit & 15k notional with the following open positions: +1 * FUT @ 271.1, +2* 280 CE @4.75, -4 * 300 CE @ 3.2 (no change in this position only). Waiting to see how this ends. Any pointers welcome.. :-)
basically the position is BULL, out of 8 purchases, 2 futures, 4 sold options and 2 option bought, 6 are of bull position. You should know what u r getting into before getting into such trade. Not at all advisicable if you don`t know the risk of such trade.
good, No BOB position for me. 804 is resistance and i was abt to take short position on BOB @800, then i heard morning call from Sukhani to go long on BOB and i dropped the plan! I went to 782, square off man, why risk 4-5k per lot for 500 rs? ha ha ha. Fantastic that u r getting things right :) Cheers.
haha.. after losing enough and more its good to gain sometimes.. btw, hows your bob call doing? are you still short or squared? i am asking cos i am short @ 798 with tgt 780 or so.. with S/L of 803 on closing basis..