Short Straddle combined premiums stoploss Strategy

Strategy Parameters Details

Entry Criteria and setup rules-:

Index: Sensex

Expiry : Current Week

Entry time: 930

Entry Time: 

• 09:17 or wait for few mins to stabilize to know exactly which straddle to enter. Always try to enter when both Ce-PE legs premiums are almost equal to each other.
• If global markets are hugely trending down, then wait for VIX to cool off.
• Stoploss :  Exit when combined premium chart closes above supertrend 

  Re-entry : Enter again if combined premium closes below supertrend after initial

  Exit time : 320

  Stoploss MTM : 3,000 Per lot

1. Adjustments 

• After entering the straddle, keep SL for each leg at Combined cost – 10% points. υ Say you enter a straddle for Rs. 90, 50 and 40 each. Keep SL for both at 90 – 9 = 81. 

• It helps psychologically and if the market goes trending in a direction, we will take at least 10 points profit. This mind set will help to hold position. 

• Trail SL as per the combined premium decay, say 10%. If premium becomes 85, trail SL to 77 (8 points), if it becomes 55, trail SL to 50 (5 points) 

• And so on until the premium falls below 40. Once it falls below 40, the chance of SL getting hit is high, so it’s better to book profits and take strangle as per 2nd strategy based on OI data