Wednesday, 16 October 2013

Free Nifty Options Tips for Day Trading

It will be great if we have a magic ball that shows the future trends of a stock. If an individual comes to know about the real trend of stock for the next few minutes, he will become a millionaire during the next hour. While no trader is sure about the market trend, every trader tends to analyze the various free nifty options tips provided by experienced professionals and decide to trade based on the most reliable ones.

What Are Option Tips?

Well, this is also called Put to call ratio. This is the proportion between the entire volume of option for the Puts and the Calls of a specific stock. This ratio is of specific interest on stocks that declare their earnings at the close of the day after the market is closed or before the opening of the market.

What to Look For?

  • Surf the net and hunt for stocks that are declaring their earnings for a specific day through earnings calendar
  • Choose those stocks that have a daily volume of more than 500K.
  • When the market is on, explore the option chain for the present month expiration on your desired stock after the stock announcement. You can extend the chain to know in detail about all the option trading during that month. If the options have the largest volume, you can go with the same stock otherwise search for another stock.
  • For having a better knowledge about the trend of a particular stock, you can also analyze its reactions for the last announcements of the company during the past four or five quarters. You need to check for the direction of the movement, and if the stock continues to move in the same way as its gap after the announcement of earnings on the day of trading, it is a good indication  
  • If you feel that movement is upwards, then go for the call option at the close of the day or on day opening before the announcement is made. Buy a Put if you feel it is a down play. You can buy the option when it is nearer to the money the potential profit will be bigger.
  • You may wish to choose the option that is cheaper enough to minimize your risk factor. If you have a higher risk tolerance, you are free to take the higher risk during the day after the announcement. If the stocks move in your favorable direction, you will reap greater profits and you might wish to ride further for increasing your profit.
If it is your first time in option trading, free nifty options tips will be of great help to you in deciding the stock to trade profitably during the day. It is always better to get advice from a financial adviser before option trading and have a thorough understanding of the nature of the option play you choose. You should also be aware of the risks involved and the probable consequences of such trade.

Here is a great post from our Guest Blogger Rajeev, have a soup of it and now let us have a good feedback. Happy reading my people!!

Author Bio: - Rajeev Kumar who is currently working in Free Nifty Option Tips provides Nifty Tips services all over India publishes is the author of this above article based on Free Nifty Options Tips.


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