Post

More from @yogeeswarpal

Yogeeswar Pal

@yogeeswarpal

Apr 14, 2021

A thread on account size. Only my opinions.

Beginner - Less than 5L.

Most preferably <2L, since chances of blow-ups are extremely high in expectation of higher returns.

Ideal Expectations(IE) - Stay break-even or more and build confidence in your skill, develop setups.

1/n

Intermediate

5-25L

This is the side-income category. Cannot reliably support family expenses only from trading income alone. Advised only if you pass the beginner stage and have confidence.

IE - 3-5%/month, more is possible depending upon skill and market conditions.

2/n

Professional

25L-1cr

The most ideal size - 50L. Stomaching drawdowns and increasing returns both would be fairly possible from there. Consistency should bring you here from Intermediate levels. Can go full-time if you feel like it.

IE- 2-5%/month, more-depending on skill.

3/n

Read 5 tweets

Yogeeswar Pal

@yogeeswarpal

Oct 14, 2020

A thread.

Earnings Trades Simplified.

Earnings announcements are public announcements that display a company’s earnings, or lack thereof. As the earnings announcement gets closer, implied volatility tends to increase. After earnings are announced,...

1/n

the uncertainty of what will happen diminishes, and usually we see a rapid decrease in implied volatility because of it. Because of this phenomena, we tend to stick to premium selling strategies when it comes to earnings plays. We can take advantage...

2/n

of the implied volatility crush by selling premium prior to the announcement, and buying it back after the announcement.

Earnings trades are not for everyone, as they involve high amounts of uncertainty and random movements.

3/n

Read 13 tweets

Yogeeswar Pal

@yogeeswarpal

Oct 13, 2020

A Thread.

What is Implied Volatility (IV) and How it can be used?

IV of a underlying shows how volatile it might be in future.

Options prices affect IV.
IV increases when premium is bought.
IV is not an input in pricing model but can be estimated from it.

1/n

1 Standard Deviation Move -

In statistics, one standard deviation is a measurement that encompasses approximately 68.2% of outcomes.

Implied volatility can help you calculate probability. When it comes to IV, one standard deviation means that there is approximately a 68%..

2/n

probability of a stock settling within the expected range as determined by option prices. In the example of a Rs. 200 stock with an IV of 25%, it would mean that there is an implied 68% probability that the stock is between Rs.150 and Rs.250 in one year.

3/n

Read 12 tweets

Yogeeswar Pal

@yogeeswarpal

Sep 29, 2020

A thread on Basic Neutral Strategies.

For Beginners.

When and what to Execute.(Discretion)

Strike Selection, Probability of Profit, Risk involved, Breakeven, Expiry.

Profitability increases IF executed at high VIX(relative) and it falls AFTER.

Assuming rangebound trend.

1/n

Types of Strategies -

1) Short Strangle
2) Short Straddle
3) Iron Condor
4) Iron Fly.

Basic parameters required -

High IV Rank(>50), High IV Percentile(>80) on the underlying product, or High VIX(relative) if traded on Indices.

Preferred to delve only on monthly options.

2/n

1) Short Strangle -.

-1*OTM CE @ x
-1*OTM PE @ y x+y = Max profit pts

Strikes prefer ->1 Standard Deviation form spot for good success ratio and better profitability. Loss unlimited.

Book the trade at 0.5*(x+y) and move out to next expiry, for better profitability.

3/n

Read 8 tweets

Yogeeswar Pal

@yogeeswarpal

Sep 28, 2020

A Thread for new traders.

Trading the right instrument-

Cash/ Futures/ Options.

What to trade?

Sentiment Assumption - Bullish.

Only Execution part, will not dwell on how to predict direction.

No complex or neutral strategies explained.

1/n

Cash

I consider Cash better than Futures for long side. It gives a good risk profile for you to operate in as a retailer. Preferred for a swing buy as BTST days are done with the new SEBI rules. It's good to have momentum with you but is not a must in shorter time frames.

2/n

Futures -

Shorter time frame can be traded with futures, though a big risk for a normal retailer. A 5% move in the underlying can make or break your account. Momentum in your direction is must, to enter.

Min Capital 12L required, to mitigate and tolerate swings in RIL Fut.

3/n

Read 9 tweets

Yogeeswar Pal

@yogeeswarpal

Sep 17, 2020

Start #trading?

A Thread.

So you want to make it as a trader, in short time?

I am going to sound discouraging but that’s how the reality will look like. I am just going to point out the main bumps ahead of you.

1/n

1) Methodology

It’s a ocean of info and you’ll be overwhelmed instantly. Most probably duped for many months /years by tips/paid services, TV channels. It will take years to find out what works for you, considering your mindset and temperament.

2/n

2) Capital - If you’re still left with capital, which will be insufficient in most cases, it is likely that you’ll never go through a cycle of trades. So yeah again chances of quitting here is very high, not trading itself but a methodology, you believed or developed.

3/n

Read 5 tweets

Share this page!

Enter URL or ID to Unroll

Yogeeswar Pal

Try unrolling a thread yourself!

More from @yogeeswarpal

Yogeeswar Pal

Yogeeswar Pal

Yogeeswar Pal

Yogeeswar Pal

Yogeeswar Pal

Yogeeswar Pal

Did Thread Reader help you today?

Don't want to be a Premium member but still want to support us?

Send Email!