Weekly Strategy, February Week 4 | Stocks and Commodities

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February 23, 2014
Time: 10.45 am

Weekly Strategy: Sell Tata Motors 380 Put option and 410 Call option.

1. Markets are trading with positive bias.
2. Last Friday's close is the highest close for Nifty in February series.
3. Tata Motors has been bullish due to strong JLR news.
4. On Monday Finance Minister announce excise duty cut for cars and commercial vehicles.
5. That has become double good news for Tata Motors.
6. Due to all these bullish news flow, Tata Motors is not likely to fall below 380 in the short term.
7. Earlier, Tata Motors faced stiff resistance around 405.
8. So it is not likely to rise above 410.
9. So we are suggesting selling 380 Put and 410 Call options.
10. Tata Motors 380 Put option closed at Rs 0.65 and 410 Call option closed at Rs 0.95.
11. Since there are only three trading sessions for this expiry, this return which works out to be more than 2% for the span margin of Rs 60000, is a good return