F&O strategy for HDFC Bank: Shubham Agarwal

Check out a few F&O strategies from Shubham Agarwal of Motilal Oswal Securities

NIFTY
OPTION STRATEGY: Hedge via put Butterfly

BUY 1 LOT DEC 7800 PE

SELL 2 LOTS DEC 7600 PE

BUY 1 LOT DEC 7400 PE

TARGET PROFIT: Rs 3800

STOP LOSS: Rs 1500

Call writing post the event does indicate expectation of big hurdles in place for Nifty on the higher side. On the other hand the activity on the Lower Puts remain awfully muted, which is scary. For overall exposure also one should resort to hedge in the Index via Put Butterfly

HDFC BANK 
OPTION STRATEGY: LONG PUT

BUY HDFCBANK 1060 @ 14.50 PE
TARGET: Rs 30
STOP LOSS:Rs 6.80 
 

 

The stock is in Short-Short Covering cycle, which keeps the outlook negative. With heaviest put of Rs 1060 in close proximity, slight further weakness could trigger a big move, which is recommended to be traded by going long in a put.

Disclaimer: Motilal Oswal Securities ( MOSL ) is regulated by the Securities and Exchange Board of India ("SEBI") and is licensed to carry on the business of broking, depository services and related activities. MOSL is in the process of getting registered under SEBI - Research Analyst Regulations. MOSL, the spokesperson or his relatives, do not have financial interest in the securities mentioned above. The spokesperson has not served as a director, employee or officer at the subject company in the last 12 months. MOSL or its associate might be involved in market making for the subject company or have potential conflict of interest.

Shubham Agarwal is a head of Quantitative Research, Motilal Oswal Securities