Caution on Thursday, care-free on Friday
Traders on Dalal Street were very cautious on Thursday, 1st February, because they were apprehensive of the wild moves expected during the pronouncement of the Budget. However, the market stayed placid and range-bound and the day ended uneventful. Option traders took home large chunks of gain.
They expected the markets to stay placid on Friday as well and were carefree. Their attitude is exemplified by that of a young, popular and dynamic trader named Ayush Verma. He sold 1000 lots of naked Put Options of Sensex 72500 PE and went to the Gym for a workout.
When he returned after an hour, he saw that the Put options had surged in value from Rs 50 to Rs 1000. The broker squared off the positions as the margin requirements were breached. There was a colossal loss of Rs 83.88 lakh.
“All Financial year profit gone in 1 move,” Ayush Verma bravely reported, with a straight face.
was driving back from gym with +1L,
when I came home, positions were squared off by zerodha,
had 72500 PE sell at 50 and squared off around 1000. https://t.co/wG6B9NVUx1 pic.twitter.com/7DNoKi1P1G— Ayush Verma (@ayushvtf) February 2, 2024
This fiasco happened because the Sensex opened Gap-up at 72000, surged to a high of 73000 by 11.40 am and plunged immediately thereafter to close at 72000 by EOD.
sensex
Jegathesan Durairaj, also a popular trader and trainer, reported a loss of Rs 28.5 lakh. He blamed “Price freeze, Slippage & freak trade on SL hunt” for the loss.
Price freeze, Slippage & freak trade on SL hunt. Resulted a Loss of 28.5L #SENSEX pic.twitter.com/Fd30zDaN4Y
— Jegathesan Durairaj (Jegan) (@itjegan) February 2, 2024
Slippage & BSE unstable setup
— Jegathesan Durairaj (Jegan) (@itjegan) February 2, 2024
“BFO trading should be stopped… Their infra is not ready to handle the large transactions.. The BSE Derivatives chain site freezes many times.. Brokers unable to cope with BSE option trading @SEBI #SEBI Should take initiative and stop trading on BFO till BSE fixes them,” a trader commented.
Other shell-shocked traders also wearily reported losses. Some were emotionally scarred and said they would take a break from trading.
Had a very good profit around 70K.
Everything wiped out within a matter of minutes.
MTM went until -12.5L Loss.
Exited around -6L.
Very disappointed.
Will take a break for a few days/months. #VerifiedBySensibull https://t.co/BZP62qLYp0— Shri Thillak Ravi (@shrithillak) February 2, 2024
It started very well. Escaped in call spike. But put spike swept me clean.
One more big loss like this, I might need to re think of my 4 years work.
Calling it quit as early is good.
Say no to fake screenshots! Check out my P&L – #VerifiedBySensibull https://t.co/WF8Axc4aGo
— Dhanasekar TS (@dhanasekar_ts) February 2, 2024
A day to forget, 5 Rs SL jump, seen nearly 5.6L loss and closed here by the time of closing, which is the only good thing that happened today and small account escaped unhurt.
Small acc: -0.8%
Overall: -4.55%#VerifiedBySensibull https://t.co/bVk34SxohL
— A Malayali Trader (@AMalayaliTrader) February 2, 2024
A terrible day with an Unimaginable Fluctuations. Although ended really well, But what the hell was even that? Say no to fake screenshots! Check out my P&L – #VerifiedBySensibull https://t.co/Xc9VL9gVRb
— KD (@KushalBavishi) February 2, 2024
Say no to fake screenshots! Check out my P&L – #VerifiedBySensibull https://t.co/fPfGSUuYr2
Highest ever losses in my account till now. SL slipped in CE side. To compensate that went PEs(4 times) aggressively. Market reversed within no time. Unable to adjust. Booked losses.— ramachandra (@ramachandrakvl) February 2, 2024
Horrible day…..Huge short covering move upside and then sharp down side…..looks like today is the budget day…#BankNiftyOptions#nifty50#finnifty
#VerifiedBySensibull https://t.co/Huh3lvqiOD— Chikka RamaKishore (@ChikkaRama) February 2, 2024
Saw a horror movie where my MTM was at -14L, even then squared off 72200PE at reasonable price, was at just -1.38L. Then spikes gave me another -2L. Starting month with a huge set back. A day that must never repeat.
Check out my P&L – #VerifiedBySensibull https://t.co/44Al1M80hO— Naveen Kumar (@ANYTHINGSNT) February 2, 2024
Avoid trading Sensex and Midcap options. They are not mature instruments
Expert trader Mitesh Patel, who reported a gain of 200%+ from Futures trading in this FY, counselled traders to avoid trading the Sensex and Midcap options and to stick to the tried and tested Nifty and Bank Nifty.
He also advised that traders should avoid trading every instrument’s expiry. “If u will play expiry everyday then there are high chances of blowing capital,” he warned in a grim tone.
Tell me the reason. Why should I play Sensex expiry?
Nifty and Bank Nifty.
Both are enough to make weekly gain.
I am playing only Nifty and Bank Nifty.
Fin nifty I played only 2-3 weeks in starting.
No midcap. No Sensex.— Mitesh Patel (@Mitesh_Engr) February 2, 2024
If u will play expiry everyday then there are high chances of blowing capital.
Reason: brutal move may come on any day and u r already playing all expiry.
If I will play only one index then blow up probability will reduce to 20%.— Mitesh Patel (@Mitesh_Engr) February 2, 2024
One man’s loss is another man’s gain
Thankfully, it was not all gloom and doom on Dalal Street. Some traders reported earning handsome profits as recorded by the Indian Traders League.
Top 10 largest win streaks reported by stock market participants as of trade date Fri Feb 02 2024.
Criteria:
Continuous days of #VerifiedBySensibull P&L without loss (>=0.0).
Sorted by net P&L.
Only realized P&L is considered. pic.twitter.com/cKIGp4HOam— Indian Trader League (@indtraderleague) February 2, 2024
Trader Vicky Kumar explained the modus operandi by which he expertly converted a MTM loss of Rs 72 lakh into a gain of Rs 16 lakh.
Shorted in Sensex when nifty at 21950 with Stop loss 22025,keeping in mind 22000 big resistance, Market moves violently
At some point of time MtM loss around 72 lacs , Sold calls aggressively when nifty hits all time high expecting some profit bookings Managed to close on green…— Vicky Kumar (@VickyKumar695) February 2, 2024
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