2nd December, 2015

Spot Price = 7931.35 or 7930

Calls
Bid
Ask
562.40
568.55
472.20
475.60
381.00
385.00
297.75
301.50
222.00
225.00
157.85
158.95
105.00
105.45
65.30
65.80
37.55
37.85
21.25
21.70
11.70
12.00
6.90
6.95

Strike
Price
7400
7500
7600
7700
7800
7900
8000
8100
8200
8300
8400
8500

Puts
Bid
Ask
13.20
13.50
20.20
20.25
30.60
30.75
46.50
46.80
69.35
70.20
102.00
103.00
147.55
148.00
204.05
206.00
274.40
276.50
353.95
357.30
443.00
447.40
537.55
539.40

Sr. No
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23

Particulars
Long Call
Short Call
Long Put

Source
Rahul Sir Notes
Rahul Sir Notes
Rahul Sir Notes

Short Put
Synthetic Long Call (Protective Put)
Long Straddle
Short Straddle
Long Strangle
Short Strangle
Bull Call Spread Strategy
Bull Put Spread Strategy
Covered Call
Long Combo
Synthetic Long Put (Protective Call)
Covered Put
Collar
Bear Call Spread Strategy

Rahul
Rahul
Rahul
Rahul
Rahul
Rahul
Rahul
Rahul

Sir
Sir
Sir
Sir
Sir
Sir
Sir
Sir

Notes
Notes
Notes
Notes
Notes
Notes
Notes
Notes

Lot Size
Strike Price
Premium

3,000
120
6.1

Stock CloseStock
60
70
80

Break Even

113.9
132
2900

90
100
110
120
130
140
150
160

Valu P/L
-72
-62
-52
-42
-32
-22
-12
-2
8
18
28

* 3,000 Long
-208800
-179800
-150800
-121800
-92800
-63800
-34800
-5800
23200
52200
81200

Put
53.9
43.9
33.9
23.9
13.9
3.9
-6.1
-6.1
-6.1
-6.1
-6.1

First Buy 1 lot of 3,000 of OTM Put of Strike Price 120 with premium of 6.1
Contract value is 3,000 * 6.1 = 18,300
Break even is strike - premium = 113.9
buy stocks of qty 3,000 at 113.9
Perfect Hedge

341700
18300
360000

tata at

spot
Lot size
strike
premium
break even
sell stock at
qty

242.85
2000
200
45
245
245
2010

320

spot
190
200
210
220
230
240
243
250
260
270
280
290
300
310

* qty
55
45
35
25
15
5
2
-5
-15
-25
-35
-45
-55
-65

long call
110550
-45
90450
-45
70350
-35
50250
-25
30150
-15
10050
-5
4020
-2
-10050
5
-30150
15
-50250
25
-70350
35
-90450
45
-110550
55
-130650
65

P/L * 3,000 Net

161700
-47100
131700
-48100
101700
-49100
71700
41700
11700
-18300
-18300
-18300
-18300
-18300

-50100
-51100
-52100
-53100
-24100
4900
33900
62900

*2000
net
-90000
20550
-90000
450
-70000
350
-50000
250
-30000
150
-10000
50
-4000
20
10000
-50
30000
-150
50000
-250
70000
-350
90000
-450
110000
-550
130000
-650

Long Call
When To Use

Investor is Bullish on the Stock/Index

Risk

Limited to the Premium

Reward

Unlimited

Breakeven

Strike Price + Premium

CMP
Strike Price
Premium
Break Even Price
(Strike Price + Premium)

7930
8100
65.8
8165.8

Nifty Closes At
7400
7500
7600
7700
7800
7900
8000
8100
8200
8300
8400
8500

Net Payoff from Call Option

-65.8
-65.8
-65.8
-65.8
-65.8
-65.8
-65.8
-65.8
34.2
8300
8400
8500

Profit

0
65.8

Loss

8100

Short Call
When To Use

Investor is Bearish on the Stock/Index

Risk

Unlimited

Reward

Limited to the Premium

Breakeven

Strike Price + Premium

CMP
Strike Price
Premium
Break Even Price
(Strike Price + Premium)

7930
7800
222
8022

Nifty Closes At
7400
7500
7600
7700
7800
7900
8000
8100
8200
8300
8400
8500
Profit

222
0

Loss

Net Payoff from Call Option

222
222
222
222
222
122
22
-78
-178
-278
-378
-478

7800

Long Put
When To Use

Investor is Bearish on the Stock/Index

Risk

Limited to the Premium

Reward

Unlimited

Breakeven

Strike Price - Premium

CMP
Strike Price
Premium
Break Even Price
(Strike Price - Premium)

7930
7900
103
7797

Nifty Closes At
7400
7500
7600
7700
7800
7900
8000
8100
8200
8300
8400
8500

Net Payoff from Put Option

397
297
197
97
-3
-103
-103
-103
-103
-103
-103
-103

Profit

0
103

Loss

7900

Short Put
When To Use

Investor is Bullish on the Stock/Index

Risk

Unlimited

Reward

Limited to the Premium Received

Breakeven

Strike Price - Premium

CMP
Strike Price
Premium
Break Even Price
(Strike Price - Premium)

7930
8100
204.05
7895.95

Profit

204.05

Loss

Nifty Closes At
7400
7500
7600
7700
7800
7900
8000
8100
8200
8300
8400
8500

Net Payoff from Put Option

-495.95
-395.95
-295.95
-195.95
-95.95
4.05
104.05
204.05
204.05
204.05
204.05
204.05

Profit

204.05
0

Loss

8100

Synthetic Long Call

When To Use

(Protective Put)
Investor is Conservatively Bullish on the Stock/Index

Risk

Losses of the Stock + Put Premium - Strike Price

Reward

Unlimited

Breakeven

Stock Price + Premium

CMP
Strike Price
Premium
Break Even Price
(Strike Price - Premium)

7930
7800
70.2
8000.2

Break Even (Put)

7729.8

Nifty Closes At
7400
7500
7600
7700
7800
7900
8000
8100
8200
8300
8400
8500

Index
-530
-430
-330
-230
-130
-30
70
170
270
370
470
570

Long Put Option

329.8
229.8
129.8
29.8
-70.2
-70.2
-70.2
-70.2
-70.2
-70.2
-70.2
-70.2

Net Payoff
-200.2
-200.2
-200.2
-200.2
-200.2
-100.2
-0.2
99.8
199.8
299.8
399.8
499.8

You own the stock

Buy a put, strike price A
Generally, the stock price will be above strike
A

e above strike

Long Straddle
When To Use
Risk
Reward
Breakeven
CMP
Strike Price
Call Premium
Put Premium
Net Premium
Break Even (Upper)
Break Even (Lower)
Break Even (Call)
Break Even (Put)

Investor expects high volatility and is neutral on the Stock/Index

Losses Limited to the Premium of Call and Put
Unlimited
Strike Price + Call Premium and Strike Price - Put Premium
7930
8000
105.45
148
253.45
8253.45
7746.55
8105.45
7852

Nifty Closes At
7400
7500
7600
7700
7800
7900
8000
8100
8200
8300
8400
8500

Long Call Option

-105.45
-105.45
-105.45
-105.45
-105.45
-105.45
-105.45
-5.45
94.55
194.55
294.55
394.55

Long Put Option

Net Payoff
452
346.55
352
246.55
252
146.55
152
46.55
52
-53.45
-48
-153.45
-148
-253.45
-148
-153.45
-148
-53.45
-148
46.55
-148
146.55
-148
246.55

Buy a call, strike price A

Buy a put, strike price A
Generally, the stock price will be at strike

ice will be at strike A

Short Straddle
When To Use
Risk
Reward
Breakeven
CMP
Strike Price
Call Premium
Put Premium
Net Premium
Break Even (Upper)
Break Even (Lower)
Break Even (Call)
Break Even (Put)

Investor expects low volatility and is neutral on the Stock/Index

Unlimited
Limited to the Premium Received
Strike Price + Call Premium and Strike Price - Put Premium
7930
8000
105
147.55
252.55
8252.55
7747.45
8105
7852.45

Nifty Closes At
7400
7500
7600
7700
7800
7900
8000
8100
8200
8300
8400
8500

Short Call Option

105
105
105
105
105
105
105
5
-95
-195
-295
-395

Short Put Option

Net Payoff
-452.45
-347.45
-352.45
-247.45
-252.45
-147.45
-152.45
-47.45
-52.45
52.55
47.55
152.55
147.55
252.55
147.55
152.55
147.55
52.55
147.55
-47.45
147.55
-147.45
147.55
-247.45

Sell a call, strike price A

Sell a put, strike price A
Generally, the stock price will be at st

trike price A
trike price A
the stock price will be at strike A

Long Strangle
When To Use
Risk
Reward
Breakeven
CMP
Call Strike Price
Call Premium
Put Strike Price
Put Premium
Net Premium
Break Even (Upper)
Break Even (Lower)
Break Even (Call)
Break Even (Put)

Investor expects High volatility and is neutral on the Stock/Index

Limited to the premium paid
Unlimited
Strike Price + Net Premium and Strike Price - Net Premium
7930
8300
21.7
7600
30.75
52.45
8352.45
7547.55
8321.7
7569.25
Use OTM Call and OTM Put
Saves Cost

Nifty Closes At
7400
7500
7600
7700
7800
7900
8000
8100
8200
8300
8400
8500

Long Call Option

-21.7
-21.7
-21.7
-21.7
-21.7
-21.7
-21.7
-21.7
-21.7
-21.7
78.3
178.3

Long Put Option

Net Payoff
169.25
147.55
69.25
47.55
-30.75
-52.45
-30.75
-52.45
-30.75
-52.45
-30.75
-52.45
-30.75
-52.45
-30.75
-52.45
-30.75
-52.45
-30.75
-52.45
-30.75
47.55
-30.75
147.55

Buy a put, strike price A

Buy a call, strike price B

Generally, the stock price will be between stri

and B

ce A

ice B

k price will be between strikes A

Short Strangle
When To Use
Risk
Reward
Breakeven
CMP
Call Strike Price
Call Premium
Put Strike Price
Put Premium
Net Premium
Break Even (Upper)
Break Even (Lower)
Break Even (Call)
Break Even (Put)

Investor expects Low volatility and is neutral on the Stock/Index

Unlimited
Limited to the premium received
Strike Price + Net Premium and Strike Price - Net Premium
7930
8300
21.25
7600
30.6
51.85
8351.85
7548.15
8321.25
7569.4
Use OTM Call and OTM Put
Saves Cost

Nifty Closes At
7400
7500
7600
7700
7800
7900
8000
8100
8200
8300
8400
8500

Short Call Option

21.25
21.25
21.25
21.25
21.25
21.25
21.25
21.25
21.25
21.25
-78.75
-178.75

Short Put Option

-169.4
-69.4
30.6
30.6
30.6
30.6
30.6
30.6
30.6
30.6
30.6
30.6

Net Payoff
-148.15
-48.15
51.85
51.85
51.85
51.85
51.85
51.85
51.85
51.85
-48.15
-148.15

Sell a put, strike price A

Sell a call, strike price B

Generally, the stock price will be betw

and B

trike price A

trike price B

he stock price will be between strikes A

Bull Call Spread Strategy

When To Use
Risk
Reward
Breakeven
CMP
ITM Call Strike Price
Call Premium
OTM Call Strike Price
Put Premium
Net Premium
Break Even
Break Even (ITM Call)
Break Even (OTM Call)

Investor is moderately bullish

Limited to the premium paid
Limited to the difference between 2 strike minus net premium cost
Strike Price of Purchased Call + Net Premium
7930
8100
65.8
8400
11.7
77.5
8177.5
8165.8
8411.7
Used to reduce the breakeven of purchased call by selling call
Saves cost

Nifty Closes At
7400
7500
7600
7700
7800
7900
8000
8100
8200
8300
8400
8500

Long ITM Call Option

-65.8
-65.8
-65.8
-65.8
-65.8
-65.8
-65.8
-65.8
34.2
134.2
234.2
334.2

Short OTM Call Option

11.7
11.7
11.7
11.7
11.7
11.7
11.7
11.7
11.7
11.7
11.7
-88.3

Profit

245.9

-54.1
Loss

8100

8400

Net Payoff
-54.1
-54.1
-54.1
-54.1
-54.1
-54.1
-54.1
-54.1
45.9
145.9
245.9
245.9

Bull Put Spread Strategy

When To Use
Risk
Reward
Breakeven
CMP
Short Put Strike Price
Short Put Premium
Long Put Strike Price
Long Put Premium
Net Premium
Break Even
Break Even (Short Put)
Break Even (Long Put)

Investor is moderately bullish or range bound

Limited but maximum when price falls below lower strike price
Limited to the premium received
Strike Price of Short Put - Net Premium Received
7930
7900
102
7600
30.75
132.75
7767.25
7798
7569.25
Boths are OTM Puts

Nifty Closes At
7400
7500
7600
7700
7800
7900
8000
8100
8200
8300
8400
8500

Short Put Option

-398
-298
-198
-98
2
102
102
102
102
102
102
102

Long Put Option

169.25
69.25
-30.75
-30.75
-30.75
-30.75
-30.75
-30.75
-30.75
-30.75
-30.75
-30.75

Net Payoff
-228.75
-228.75
-228.75
-128.75
-28.75
71.25
71.25
71.25
71.25
71.25
71.25
71.25

Covered Call
When To Use
Risk
Reward
Breakeven
CMP
OTM Call Strike Price
Call Premium
Break Even
Call Break Even

Investor is moderately bullish or Short Term Neutral

Loss of stock - Call premium received
Limited to Call Strike Price + Premium - Stock Price
Stock Price Paid - Premium
7930
8300
21.25
7908.75
8321.25

Nifty Closes At
7400
7500
7600
7700
7800
7900
8000
8100
8200
8300
8400
8500

Stocks
-530
-430
-330
-230
-130
-30
70
170
270
370
470
570

Short Call Option

21.25
21.25
21.25
21.25
21.25
21.25
21.25
21.25
21.25
21.25
-78.75
-178.75

Net Payoff
-508.75
-408.75
-308.75
-208.75
-108.75
-8.75
91.25
191.25
291.25
391.25
391.25
391.25

Long Combo
When To Use

Investor is Bullish on Stock

Risk

Unlimited

Reward

Unlimited

Breakeven

Call + Net Premium

CMP
OTM Call Strike Price
Call Premium
OTM Put Strike Price
Put Premium
Net Premium
Break Even

7930
8100
65.8
7800
69.35
3.55
8103.55

Call Break Even

Put Break Even

8165.8
7730.65
Saves Premium

Nifty Closes At
7400
7500
7600
7700
7800
7900
8000
8100
8200
8300
8400
8500

Long Call Option

-65.8
-65.8
-65.8
-65.8
-65.8
-65.8
-65.8
-65.8
34.2
134.2
234.2
334.2

Short Put Option

-330.65
-230.65
-130.65
-30.65
69.35
69.35
69.35
69.35
69.35
69.35
69.35
69.35

Net Payoff
-396.45
-296.45
-196.45
-96.45
3.55
3.55
3.55
3.55
103.55
203.55
303.55
403.55

Synthetic Long Put

When To Use
Risk
Reward
Breakeven
CMP
Strike Price
Premium
Break Even Price
(Stock Price - Premium)
Break Even (Call)

(Protective Call)
Investor is Conservatively Bearish on the Stock/Index
Limited to difference of Stock and Strike Price + Premium
Unlimited
Stock Price - Premium
7930
8200
37.85
7892.15

8237.85

Nifty Closes At
7400
7500
7600
7700
7800
7900
8000
8100
8200
8300
8400
8500

Short Index
530
430
330
230
130
30
-70
-170
-270
-370
-470
-570

Long Call Option

-37.85
-37.85
-37.85
-37.85
-37.85
-37.85
-37.85
-37.85
-37.85
62.15
162.15
262.15

Net Payoff
492.15
392.15
292.15
192.15
92.15
-7.85
-107.85
-207.85
-307.85
-307.85
-307.85
-307.85

Covered Put
When To Use
Risk
Reward
Breakeven
CMP
OTM Put Strike Price
Premium
Break Even Price
(Stock Price + Put Premium)
Break Even (Put)

Investor is Bearish or Range Bound on the Stock/Index

Unlimited if the price risies
Limited to difference of Spot and Strike - Premium
Stock Price + Put Premium
7930
7800
69.35
7999.35

7730.65

Nifty Closes At
7400
7500
7600
7700
7800
7900
8000
8100
8200
8300
8400
8500

Short Index
530
430
330
230
130
30
-70
-170
-270
-370
-470
-570

Short Put Option

-330.65
-230.65
-130.65
-30.65
69.35
69.35
69.35
69.35
69.35
69.35
69.35
69.35

Net Payoff
199.35
199.35
199.35
199.35
199.35
99.35
-0.65
-100.65
-200.65
-300.65
-400.65
-500.65

Covered Put
When To Use
Risk
Reward
Breakeven
CMP
OTM Put Strike Price
Premium
OTM Call Strike Price
Premium
Break Even Price
(Stock Price + Put Premium)
Break Even (Put)
Break Even (Call)

Investor is Conservatively Bullish on the Stock/Index

Limited
Limited
Stock Price + Put Premium - Call Premium
7930
7800
69.35
8200
37.55
7961.8

7730.65
8237.55

Nifty Closes At
7400
7500
7600
7700
7800
7900
8000
8100
8200
8300
8400
8500

Long Index
-530
-430
-330
-230
-130
-30
70
170
270
370
470
570

Long Put Option

330.65
230.65
130.65
30.65
-69.35
-69.35
-69.35
-69.35
-69.35
-69.35
-69.35
-69.35

Short Call
37.55
37.55
37.55
37.55
37.55
37.55
37.55
37.55
37.55
-62.45
-162.45
-262.45

Net Payoff
-161.8
-161.8
-161.8
-161.8
-161.8
-61.8
38.2
138.2
238.2
238.2
238.2
238.2

Bear Call Spread Strategy

When To Use
Risk
Reward
Breakeven
CMP
ITM Call Strike Price
Call Premium
OTM Call Strike Price
Put Premium
Net Premium
Break Even
Break Even (ITM Call)
Break Even (OTM Call)

Investor is mildly bullish

Limited to the difference between 2 strikes and premium paid
Limited to the difference between 2 strike minus net premium cost
Strike Price of Purchased Call + Net Premium
7930
8100
65.8
8400
11.7
77.5
8177.5
8165.8
8411.7
Used to reduce the breakeven of purchased call by selling call
Saves cost

Nifty Closes At
7400
7500
7600
7700
7800
7900
8000
8100
8200
8300
8400
8500

Long ITM Call Option

-65.8
-65.8
-65.8
-65.8
-65.8
-65.8
-65.8
-65.8
34.2
134.2
234.2
334.2

CHECK BULL AND BEAR CALL SPREAD

SOMETHING IS WRONG WITH ITM AND OTM

Short OTM Call Option

11.7
11.7
11.7
11.7
11.7
11.7
11.7
11.7
11.7
11.7
11.7
-88.3

Net Payoff
-54.1
-54.1
-54.1
-54.1
-54.1
-54.1
-54.1
-54.1
45.9
145.9
245.9
245.9