Derivative strategy on Larsen & Toubro by Chandan Taparia

Derivative strategy on Larsen & Toubro by Chandan Taparia of Motilal Oswal Securities: 

OPTION STRATEGY:

Larsen & Toubro  Call Ladder Spread

Buy 1540 CE 1 lot
Sell 1560 CE 1 lot
Sell 1580 CE 1 lot

Target Profit: Rs 10,000  
Maximum Loss: RS 1,000 below 1,540
Hedge Above: Buy Future above 1595

Rationale:

1. Larsen & Toubro has been consolidating in last few trading session
2. Highest put congestion at 1520 could provide support to the stock. while highest call congestion is placed at 1560
3. As we are participating bullish momentum and to benefit from theta decay, Bull Call Ladder is recommended

: Motilal Oswal Securities ( MOSL ) is regulated by the Securities and Exchange Board of India ("SEBI") and is licensed to carry on the business of broking, depository services and related activities. MOSL is in the process of getting registered under SEBI - Research Analyst Regulations. MOSL, the spokesperson or his relatives, do not have financial interest in the securities mentioned above. The spokesperson has not served as a director, employee or officer at the subject company in the last 12 months. MOSL or its associate might be involved in market making for the subject company or have potential conflict of interest.

Chandan Taparia is a Deivatives and Technical Analyst at Motilal Oswal Securities.


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