Planning to buy niftybees. Using that as collateral, I am going to sell Nifty call option. Would like to know how to manage my call position if nifty goes up.

Question and Answer – Forum › Category: strategy › Planning to buy niftybees. Using that as collateral, I am going to sell Nifty call option. Would like to know how to manage my call position if nifty goes up.

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Raghu Staff asked 4 years ago

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Raghu Staff answered 4 years ago

Yes, you can pledge NiftyBees and write options.
NiftyBees have close 1-1 correlation with Nifty Index. Hence if you want to mirror the index, the pledged margin from NB should be 75*SPOT. You can choose to write the corresponding 2-3 SD (on both sides) options from SPOT. Tool for SD table for Nifty here – https://tools.niftybanknifty.com/nifty-range-using-standard-deviation.php