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  #31 (permalink)  
Old 20-07-2015, 10:09 PM
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Originally Posted by mmca2006 View Post
yes, correct ,now I will go for credit spread with far OTM with high probability of winning, THANKS SEBI

But Option Oracle is not working
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Old 21-07-2015, 11:21 AM
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Originally Posted by mmca2006 View Post
yes, correct ,now I will go for credit spread with far OTM with high probability of winning, THANKS SEBI

How is the option pricing model dependent upon the lot size ?
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Old 21-07-2015, 03:14 PM
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Originally Posted by MatSol View Post
How is the option pricing model dependent upon the lot size ?


u r correct . option pricing never ever depends on lot size but my risk ability depends on lot size , what i wanted to mean -- currently I am doing credit spread by shorting ATM call buying OTM call , with increased lot size I will do same credit spread by shorting OTM call and buying far OTM call , my risk amount , profit amount will remain more or less same because of increased lot size but probability of winning the trade will be more because of shorting of OTM call instead of ATM call. Am I wrong my friend !!
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Old 21-07-2015, 03:47 PM
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Originally Posted by mmca2006 View Post
u r correct . option pricing never ever depends on lot size but my risk ability depends on lot size , what i wanted to mean -- currently I am doing credit spread by shorting ATM call buying OTM call , with increased lot size I will do same credit spread by shorting OTM call and buying far OTM call , my risk amount , profit amount will remain more or less same because of increased lot size but probability of winning the trade will be more because of shorting of OTM call instead of ATM call. Am I wrong my friend !!

You could do the same right now by trading twice the lots. Why wait till November ?

Most lots are around 2.5L-3L, so when today's 2 lots will be equivalent to 1 lot in November.
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Old 21-07-2015, 04:39 PM
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Originally Posted by MatSol View Post
You could do the same right now by trading twice the lots. Why wait till November ?

Most lots are around 2.5L-3L, so when today's 2 lots will be equivalent to 1 lot in November.

yes , I m doing it now but with one lot ATM , After oct,15 will do it with one lot OTM.
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Old 10-08-2015, 01:23 PM
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New lot sizes from November
http://www.nseindia.com/content/circulars/FAOP30449.pdf

Nifty 75 Sebi
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Old 12-11-2015, 10:01 AM
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Increase in the minimum contract size for trading in equity derivatives from Rs 2 lakh to Rs 5 lakh has adversely impacted derivatives volumes on the bourses. According to exchanges data, monthly average daily volumes in the F&O segment has dipped about 23 per cent in November over the previous month. Monthly average daily volumes have stayed over the Rs 3-lakh-crore mark in six out of 10 months this year.

According to experts, 20-30 per cent of the F&O turnover comes from retail participants. At least 30 per cent of retail volumes could get hit because of the new contract size, they said.

et
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Old 12-11-2015, 11:10 AM
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Originally Posted by rajeshn07 View Post
Increase in the minimum contract size for trading in equity derivatives from Rs 2 lakh to Rs 5 lakh has adversely impacted derivatives volumes on the bourses. According to exchanges data, monthly average daily volumes in the F&O segment has dipped about 23 per cent in November over the previous month. Monthly average daily volumes have stayed over the Rs 3-lakh-crore mark in six out of 10 months this year.

According to experts, 20-30 per cent of the F&O turnover comes from retail participants. At least 30 per cent of retail volumes could get hit because of the new contract size, they said.

et



Lot size 50 is ok . But 75 is somewhat big . Then they should have introduced a Minifty to the size of 25 .
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Old 12-11-2015, 02:24 PM
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Originally Posted by Sunshine View Post


Lot size 50 is ok . But 75 is somewhat big . Then they should have introduced a Minifty to the size of 25 .

Buzz is they want retail out of derivatives and more participation in cash market and IPO( quite a number of public sector FPOs on the list). That's the reason they removed mininifty earlier and not 75.

Whenever there is such a big lot change, there was a big move on either side of the markets.
This time it is down?
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Old 12-11-2015, 03:03 PM
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Drop in Volume is natural and was expected, but it will be a temporary effect. Its just like shockwave or mathematical discontinuity behavior which will take time to normalize.

And if their intention is really to divert towards and promote primary/cash market then this is not going to work. Humans have natural tendency to go towards restriction. Rather they should think different incentive based rewarding approach for Cash market revival. Restriction on one to promote other is never going to work.

One modification they can implement is to make Option lot size 100 or 50 irrespective of security. This I think is not going to affect hedging mechanism of Future security much but will give more flexibility to retail with their Cash market hedging with Options. This may act as reverse catalyst for Cash market IMO.
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