Strategy description

About the Strategy

The current market scenario has created challenges for option sellers due to lower premiums and an increase in market reversals. This has led to the creation of a smarter strategy that focuses on smart direction selection rather than relying on mathematical adjustments. Additionally, some traders are interested in strategies that involve fewer trades, which inspired us to develop this approach: one smart trade a day, and once entered, stick to it.

Strategy Overview

1. Single Trade Per Day: The strategy involves only one trade per day, specifically in BANKNIFTY. No re-entry is allowed once a trade is placed.
2. Direction Prediction:The strategy uses technical analysis modeling to predict the direction. Based on the prediction, the strategy will either:
   1. Sell 2 lots of BANKNIFTY CE (Call Options), or
   2. Sell 2 lots of BANKNIFTY PE (Put Options), or
   3. Sell one lot of each (CE and PE) if the model suggests.
3. Exit Condition: Once the trade is entered, it will exit based on predefined exit conditions or at the end of the day. There is no re-entry during the day.
4. Intraday Focus: This is an intraday strategy designed to avoid overnight risk associated with selling options.
5. Manual Intervention: As a directional strategy, the P&L may swing throughout the day, which could tempt you to take manual actions. We advise maintaining calm trading psychology. If you feel uncomfortable with such fluctuations, consider sticking with our "Tortoise" strategies instead.
6. Capital Diversification: If you have substantial capital and the capacity to deploy more, we recommend diversifying into other strategies to mitigate risk. Always conduct thorough due diligence before doing so.

Strategy Details

1. Entry Time: 9:20 AM (when the entry conditions are met).
2. Exit Time: 3:08 PM (universal exit time).
3. Inbuilt Hedges: Yes, hedges are included for protection against major market movements.

Broker Requirements

1. Broker Selection: Since this strategy involves few trades, there is no stringent requirement for broker selection. However, you should ensure that the brokerage charged on hedges is minimal.

Deployment Considerations

1. Capital Balance: Ensure your account has sufficient balance to cover the multiplier and capital requirement. Failing to do so may result in an error execution state, where Tradetron will pause the strategy's condition checking.
2. Handling Interruptions: If your deployment is interrupted for any reason (e.g., if the strategy is paused or encounters an error), ensure that the strategy status is properly reset to “exited.” This will help reset the counters and variables used in the strategy, ensuring a fresh start the following day.

Risk Disclaimer

1. Non-SEBI Registered: We are not SEBI-registered analysts. Neither the strategy creator nor Tradetron is responsible for any losses incurred through the deployment of this strategy.
2. Financial Advice: Please consult your financial advisor before engaging in stock/options trading. Only trade with capital you can afford to lose, and avoid using emergency funds or taking excessive exposure that could impact your financial stability.
3. Automated Trading Risks: Automated trading is not unsupervised. While the strategy is designed to function autonomously, it is essential to monitor the trading process as technical limitations, errors, or downtime can occur. Keep an eye on the trading activity to address any issues promptly.