Derivative strategy on Nifty by Motilal Oswal Securities

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Derivative strategy on Nifty by Chandan Taparia of Motilal Oswal Securities:

 

STRATEGY: Nifty Ratio Call Spread

 

Buy 9250 CE 1 lot

Sell 9400 CE 2 lots

 

Rationale:

 

1. Nifty is scaling higher post march expiry. Technically 9,191 remains strong support while a move above 9,280 can propel momentum towards 9,350-9,380.

2. Falling India VIX below 12% indicates market participant are confident of current up move

3. PCR OI has direct relationship with market. It is quoting near 1.07 indicating positive bias

4. Option indicative band shows 9000 as vital support while highest call concentration is at 9,500

5. Considering falling volatility, Ratio Call Spread is recommended

 

Target: Rs. 9,000 at 9,400 level

Maximum Loss: Rs. 2,250 below 9,250 level

Hedge: Buy future above 9,500

 

Disclaimer: 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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