Best way to trade is trading with hedged positions, one can sleep in peace without affecting mental peace through the uncertainties of next day gap up and gap downs, even with weekly directional positions.

My favorite strategy is Bear Call Spread or Bull Put Spread with risk and profits defined but with a personalized twist.

Example:

If a market is trading at 18000, and say my weekly view is bullish I would place the following orders.

Sell deep in the money puts, say 18250 PE, but next week expiry.

Buy a little deep in the money puts, say 18150 PE, next week expiry.

This way risk to reward is minimum of 1:2

Advantages::

1. Time Decay on our side.
2. Risk id defined.
3. Risk to reward is at least 1:1.5 minimum
4. Peace of mind
5. Margin Required is very less, Per lot around Rs. 25K to 27K only required.

P&L Graph looks something like this in fig. 1

My Positions carried forward for next week expiry

Disclaimer:-

The above analysis is solely the opinion of the author, no way an assured tips/direction to trade, they are solely for educational purposes. Please do not trade with out a proper study and analysis, we will not be responsible for your loss. We are not SEBI registered.

#SafeBull