Who wrote this article?

Deepak Shenoy, Capitalmind's research team.

SOS Trade: Buy Nifty Puts

21 Aug 2008Deepak Shenoy1 min read

Quick Facts

What is "SOS Trade: Buy Nifty Puts" about?
What category is this article in?: General
Who wrote this article?: Deepak Shenoy, Capitalmind's research team.
When was this article published?: Published 21 August 2008.
How long does this article take to read?: 1 min read
What topics does this article cover?: ShortOnly

It’s probably the lousiest day to set up a short, after the index is nearly 3% down; but I’m getting the feeling it’s going down further. Worst case, I lose some virtual money.

So I’m buying Nifty puts for 4400, for August - which will expire next week, so it’s a short term trade. The puts were last traded at 139.05, and I will put 40% of hte net portfolio on it - that’s 20L. Since each contract (50 Nifty) is 2.2L in size, I’ll be buying 8 contracts - or 400 Nifty puts.

The cost is 55,000 and I expect to close this trade next week. Let’s see how it goes.

Disclosure: Short the Mini-Nifty today. Just to check something out.