By Motillal Oswal SecurititesOption WritingSTRATEGY 1Writing against Cash / Fut HoldingSell Lupin 800 CE 31 MAY at Rs 11.90Target Level : 1.90Stop Loss Level : 17Gross Monthly Yield : 1.35 per centROI : 9.25 per centMargin : Rs 65,000Days to Expiry : 18Writing with HedgingLeg 1 : Sell Lupin 800 CE 31 MAY at Rs 11.90Leg 2 : Buy Lupin 840 CE 31 MAY at Rs 5.15Target Level : 0Stop Loss (Spread) Level : 10.50Gross Monthly Yield : 1 per centROI : 6.65 per centMargin : Rs 61,000Days to Expiry : 18STRATEGY 2Writing against Cash / Future HoldingSell PNB 105 CE 31 MAY at Rs 0.90Target Level : 0.10Stop Loss Level : 1.20Gross Monthly Yield : 1 per centROI : 6.30 per centMargin : Rs 51,000Days to Expiry : 18Writing with HedgingLeg 1 : Sell PNB 105 CE 31 MAY at Rs 0.90Leg 2 : Buy PNB 115 CE 31 MAY at Rs 0.35Target Level : 0Stop Loss (Spread) Level : 0.85Gross Monthly Yield : 0.75 per centROI : 4.50 per centMargin : Rs 49,000Days to Expiry : 18Pair TradingSTRATEGY 1Leg 1 : Buy HDFC 1 LOT 31 MAY at Rs 1,928.80Leg 2 : Sell HDFC BANK 1 LOT 31 MAY at Rs 2012.60Tenure : 7-8 DaysTarget Profi t : 3.95 per centStop Loss : 1.85 per centMargin : Rs 2,44,000This pair has 97 per cent correlation over the last one year.
Pair has trade lot ratio of 1 with price ratio of 0.96.
It has been moving in a spread of 15 to 115 points from last couple of quarters and as per statistical data expecting this pair to come towards its mean levels.Pair TradingSTRATEGY 2Leg 1 : Buy Godrej CP 1 LOT 31 MAY at Rs 1,078.45Leg 2 : Sell Godrej Ind 1 LOT 31 MAY at Rs 593.70Tenure : 6-7 DaysTarget Profi t : 4.50 per centStop Loss : 2.35 per centMargin : Rs 2,18,000This pair has 89 per cent correlation over the last one year.
Pair has trade lot ratio of 1 with price ratio of 1.82.
As per statistical data, pair has deviated to the extreme zone of the trading band thus expecting it to move towards statistical mean levels.