Strategy description

This strategy takes short positions in Nifty and Bank Nifty options and has a dynamic adjustment mechanism based on the market conditions to provide superior results in sideways and trending market. It is a passive income generation strategy with a focus on earning theta decay (time component of the premium) during intraday. 

The strategy is designed in such a way to enhance returns with limited capital risk in a highly volatile market. 

STRATEGY DETAILS

Entries: Multiple entries per day with 1 lot of CE and PE each  in Nifty and Bank Nifty both (4 legs in total) - takes about 1 to 3 entries per day depending on market volatility and other conditions. May take more entries on a highly volatile day.

First Entry Time: Dynamic range between 9:16 to 9:25 AM, depending on meeting criteria

Target: Dynamic between 1500 to 2000, will only exit on target if the next entry is not expected to be with the same strikes in order to optimize number of trades.

Leg Level Stop Loss: Dynamic

Last Exit Time: 2:45 PM

Last Entry Time: 2:00 PM

Strategy Level Stop Loss: Maximum loss per entry capped between 2000 to 2200. Slightly varies due to slippage.

As the strategy takes multiple entries per day, only deploy this strategy if your brokerage is either free or less than INR 10 per trade. 

Be patient with the positions as it's time decay strategy, it will take its time to get you the P&L in the intraday. If you stop it in between or exit, it might not give you the expected results. Theta decay happens faster closer to expiry, so accordingly, we will get better results closer to expiry... so stay invested :) 

Review the Current P&L and Back Testing Results

Live P&L Status Details :

Back testing results :  

Before going for Live deployment:

1.  Paper trade for a few days (at least a week) and understand the dynamics. Take your time and analyze the results for a few days before opting for live trading. Don't fall for instant gratification. Be patient. 

2. Diversification: Prefer diversifying your capital across multiple strategies instead of using a higher multiplier in one. All strategies are good. Each one will have its good and bad days.

3. No manual intervention: Once you decide to deploy, make it a point to not interfere manually even if there is a loss. Don't use your personal discretion. Deploy only when you start trusting the strategies after paper trading.

4. Multiplier: Don't increase/decrease the multiplier on the basis of profits/losses. Keep it constant for at least a week. Else you might make losses on higher multipliers and profits on lower.

5. Stick to the strategy for at least a month: Don't discard any strategy very quickly. It's not a quick-rich scheme. You need to accept losses as well. Many people delete the deployments if they suffer a loss on the first day. This is not the right way of systematic trading. 

6. Intraday deployment and changes: Don't make any changes during trading hours eg: changing multiplier, pausing/reactivating, etc.

In case of any queries related with Algo trading, please reach out to us on below mentioned platforms. Always happy to help.

 Telegram Channel - https://t.me/Algos_With_Ankur

 Telegram Group - https://t.me/Algos_With_Ankur_Community

 Mail - [email protected]

*We are not SEBI registered and the strategy results are purely based on index movements. Past performance does not guarantee future performance. Please understand the risks before using this strategy.