Nifty options or stock options ?
A continuous dilemma for most of option traders.
Whereas there is great liquidity in Nifty Options not only for current month but also for next month, low implied volatilities reduce the premiums.
On the other hand we get decent premiums in stock options but liquidity is always an issue in most of them.
Hence both have there own pros and cons.
In present scenario, where extreme volatility is there in Nifty options, it requires great skill as an option trader to make positive returns. Because of low premiums, even a small movement in market can spoil the show for option writers. One need a very experienced and well tested adjustment strategy to sail through such environment of low premiums and high movements. Margin of error is very low and volatility reduces probability of success.
Stock options are always volatile. They are volatile now also. But if we compare with Nifty options, in the present environment both are volatile. Stock options provide high premiums whereas Nifty options are having low premiums. Because of availability of good premiums , trading stock options can be much more beneficial compared to index options. High premiums in stock options also take care of liquidity issues to some extent.
So in present environment , stock option trading makes much more logical sense. Only thing required is , a sound strategy – which protects capital as well as ensure great returns. This is surely very well achieved by our MASTER STRATEGY.( http://www.masterstrategy.in)
MASTER STRATEGY is a strategy for stock futures and options and is practically risk free , gives decent returns on consistent basis and easy to execute.
What else can any sound trader expect !
#niftyoptions #stocktrading #strategies