Retail options tactics from the book
Indian retail options plays: weekly hedged trades, OI-based buying, expiry-day setups, momentum-based option selling. Supplements the McMillan-depth options chapters.
Sell a weekly OTM strangle and buy further-OTM protective wings — essentially an iron condor entered mid-week. Defined risk, positive theta, bounded loss.
Bias from the daily chart; entries triggered on the hourly. Aligns direction across timeframes before deploying long options — reduces whipsaw losses.
Rising OI + rising price = long unwinding not happening → buy calls. Rising OI + falling price = fresh shorts building → buy puts. Uses OI change as directional filter for option purchases.
Sell OTM call when Supertrend is red; sell OTM put when Supertrend is green. Direction gives you the wrong-side to sell; theta and IV crush deliver profit.
Use VWAP as the intraday trend line. Buy calls only when price is above VWAP with rising momentum; buy puts only when below VWAP. Simple, disciplined intraday option buying.
Wait for a breakout candle on the 5-min chart of the underlying, confirmed by volume. Buy an ATM/slightly-OTM option in the breakout direction; exit on 1-ATR target or breakdown.
On expiry day, sell an ATM straddle or a tight strangle after 11am. Theta collapses through the day; close by 3pm to avoid pin-risk chaos in the last 30 min.
For a two-leg strangle, use a portfolio-level stop (e.g., total loss ≥ 30% of premium) rather than per-leg stops. Avoids being taken out on a normal one-side move.
Systematically sell 30–45 DTE options and manage at 50% profit. Consistent theta capture with defined-risk structures (iron condors, credit spreads).
"Buy Today, Sell Tomorrow" — buy an option near market close if the underlying shows strong closing momentum, exit next morning on the gap-and-go. Captures overnight follow-through.
Enter a Nifty option position at 3:00 pm based on the day's trend + closing 30-min setup. Exit at the 3:20 pm close. Captures the pre-close bias with minimal duration.
Sell OTM options in the direction opposite to a fading move. Enter when momentum indicators (RSI, ADX) show trend exhaustion — collect premium as the move reverses.
Buy monthly ATM/slightly-ITM options in the direction of a multi-day swing. Hold for 3–7 days; exit on 30–50% profit target or a break of the swing structure.