By Motilal Oswal Securities

Option Writing

STRATEGY 1
Writing against Cash / Future Holding
Sell AXIS BANK 520 CE 28-MARCH-18 @ 1.60
Target Level : 0
Stop Loss Level : 2.40
Gross Monthly Yield : 3.20 per cent
ROI : 3.50 per cent
Margin : 55,200
Days to Expiry : 3

Writing with Hedging
Leg 1 : Sell AXIS BANK 520 CE 28-MAR-18 @ 1.60
Leg 2 : Buy AXIS BANK 540 CE 28-MAR-18 @ 0.65
Target Level : 0
Stop Loss (Spread) Level : 1.45
Gross Monthly Yield : 1.90 per cent
ROI : 2.15 per cent
Margin : 53,500
Days to Expiry : 3

STRATEGY 2
Writing against Cash / Future Holding
Sell VEDL 290 CE 28-MARCH-18 @ 1.05
Target Level : 0
Stop Loss Level : 1.60
Gross Monthly Yield : 3.80 per cent
ROI : 3.70 per cent
Margin : 50,000
Days to Expiry : 3

Writing with Hedging
Leg 1 : Sell VEDL 290 CE 28-MARCH-18 @ 1.05
Leg 2 : Buy VEDL 300 CE 28-MARCH-18 @ 0.35
Target Level : 0
Stop Loss (Spread) Level : 1.05
Gross Monthly Yield : 2.50 per cent
ROI : 2.70 per cent
Margin : 45,000
Days to Expiry : 3

Pair Trading
STRATEGY 1
Leg 1 : Buy HDFC BANK 1 LOT 26-APR-18 @ 1849.15
Leg 2 : Sell HDFC LTD 1 LOT 26-APR-18 @ 1799.50
Tenure : 7-8 Days
Target Profi t : 3 per cent
Stop Loss : 1.65 per cent
Margin : 2,89,000

This pair has 96 per cent correlation over the last one year. Pair has Trade lot ratio of 1 with price ratio of 1.03. It is well cointegrated and one of the best pair to deliver the consistent return in last one year.

Pair Trading
STRATEGY 2
Leg 1 : Buy GODREJIND 1 LOT 26-APR-18 @ 535.95
Leg 2 : Sell GODREJ CP 1 LOT 26-APR-18 @ 1101.70
Tenure : 7-8 Days
Target Profi t : 3.65 per cent
Stop Loss : 1.75 per cent
Margin : 2,63,500

This pair has 90 per cent correlation over the last one year. Pair has Trade lot ratio of 1.1 with price ratio of 0.49.