Algo Strategy : Long Straddle is executed when a trader wants to take advantage of Rise in a Volatility or a strong move in either direction by underline stock on some news or data.
Strategy :
Buy ATM CALL
BUY ATM PUT
NIFTY 50 Underline : 17850
BUY ATM CALL Strike 17850 : Premium Paid Rs. 117
BUY ATM PUT Strike 17850 : Premium Paid Rs. 118
When NIFTY 50 Falls to 17400
Net Profit = 17850-17400-117-118 = Rs.215
When NIFTY 50 Rises to 18200
BUY ATM CALL Strike 17850 : Premium Paid Rs. 117
BUY ATM PUT Strike 17850 : Premium Paid Rs. 118
Net Profit = 18200-17850-117-118 = Rs.115
Formula for Maximum Profit :
Price of Underlying – Strike Price of Long Call – Net Premium Paid OR
Strike Price of Long Put – Price of Underlying – Net Premium Paid
Maximum Profit : Unlimited
Maximum Loss : Premium Paid + Brokerage
ALGO Strategy Synthetic Long : Options Strategy : Synthetic Long Futures
NSE India Options Chain Website https://www.nseindia.com/option-chain
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