Which is the best options strategy to implement when there is a heavy volatility in index?
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First of all we cannot predict the market movement. If you can predict the volatile market, you have many ways to earn money.
Here are few general ways to predict the volatile market.
The above indications are not holy grail, anything can happen in the market.
Best Strategy to execute in Volatile Market:
Which strategy is best for high VIX?
Yes, It is very difficult to take move during volatile markets. I would add a few tips for you that can create a certain clarity as to how to progress when the market experiences high volatility.
Volatility in general is the price fluctuation of a stock in stock exchanges.
Stock markets undergo volatility quite frequently and under such conditions you need not panic.
When the volatility is typically high you must follow certain trading patterns that involve the implementation of strategies for good returns on investments.
Option Trading Strategies in High Volatility:
Depending on the market’s price fluctuations and the degree of risk you can bear, experts have defined strategies to win over the trading platform, NSE/BSE. You can try these trading option strategies such as long puts, short calls, straddles, Hedging and benefit
Strategies in Option Trading on Low Volatility:
You can also execute trades in low volatility conditions that encounter lower price fluctuations and cause less risk on your underlying assets in the stock markets. You can try on debit spreads & ratio spreads to make good returns on low volatility conditions.
Debit Spreads: You can reduce the cost of the trading, limit the risk and gain rewards by employing the debit spreads. You must buy and sell options of underlying assets on selecting a different strike price with the same expiration date.
Ratio Spreads: In this kind of strategy, the directional bias, and an increase in volatility does benefit the trade. In it, you must buy and sell options of the identical underlying assets, same expiration date. However, you will have to select a different strike price and lot size of the underlying asset.