I had bought Futures to salvage a naked Call short in the expiry of 15th September. The Call expired worthless and so I decided to shift the Call to the next expiry. I also sold a 42000 Call as additional precaution. This makes it a ratio spread with a lower BEP of 40700 and a higher BEP of 42800.
(https://zerodha.trade/zerodha-uploads/Bank_Nifty_Futures_Calendar_Ratio.png)
The Bank Nifty has softened a bit. My option is to either roll down the short calls or to add more quantities. As I am flush with funds, I chose to add more rather than rolling down. If the Bank Nifty comes closer to the BEP, I will either roll down the short calls (depending on the premium remaining) or add a Put Calendar to extend the lower BEP.
(https://zerodha.trade/zerodha-uploads/Bank_Nifty_Futures_Calendar_Ratio_160922.png)
The Bank Nifty dipped further to 40500 and came close to the BEP. Instead of moving the Call shorts closer, I added a Put Calendar. This extended the lower BEP to 40400. On Monday or Tuesday, I will roll down the Call shorts if there is no bounce.
(https://zerodha.trade/zerodha-uploads/Bank_Nifty_Ratio_160922.png)
The Bank Nifty is presently at 41100. The trade is quite comfortably placed. I don't want to roll down the short calls because the market is looking bullish and also there is huge premium remaining in the 42000 Calls.
(https://zerodha.trade/zerodha-uploads/Bank_Nifty_Options_Trade.png)
The Futures Ratio trade is showing a good profit of about Rs 67000 at present without any incremental adjustments. I intend to square off the trade tomorrow because the next day is the FOMC meeting which may create unmanageable volatility. I will shift the capital to some other trade.
(https://zerodha.trade/zerodha-uploads/Bank_Nifty_Options_Trade190922.png)
The trade is nicely placed in the center with a MTM gain of Rs 1.75 Lakh. I don't want to carry it overnight because of the FOMC risk tomorrow. I will square if off either by the EOD or if the MTM gain is reduced to Rs 1.50 Lakh.
(https://zerodha.trade/zerodha-uploads/Bank_Nifty_Calendar_Ratio_200922.png)
The market surged to 41640+ causing my MTM to dip to Rs 150000. I exited the position at that stage.
I now have a ratio calendar spread in place. It should (hopefully) be relatively easier to manage.
(https://zerodha.trade/zerodha-uploads/Bank_Nifty_Calendar_Ratio_200922-2.png)