Worst case known before you start
The most these can lose on one trade is fixed when it is placed. If you are new to this, start here.
Iron condor
Earns a small, fixed amount when the index stays inside a range for the week, and can never lose more than a figure known before the trade is placed.
- Trades
- index options, income
- Holds
- closes the same day
- Worst case
- fixed before entry
Trend credit spread
Earns a premium by betting the index will not fall below a level while its trend is up, or rise above one while it is down. The most it can lose is fixed before entry.
- Trades
- index options, with the trend
- Holds
- closes the same day
- Worst case
- fixed before entry
Buys shares and waits
Ordinary share purchases, held for days to months, with one rule for when to buy and one for when to sell. The closest things here to investing.
Market mode
Owns a basket of big companies while the overall market is rising and sells the lot when it turns down. One switch, read from NIFTY, decides whether you are invested or in cash.
- Trades
- shares, held for days
- Holds
- months
- Worst case
- limited by a stop
Long-term trend
Owns a big company while its long-term trend is up and sells when that turns. A few decisions a year, held for months, and the easiest strategy here to live with.
- Trades
- shares, held for days
- Holds
- months
- Worst case
- limited by a stop
New-high momentum
Buys a big company on the day it reaches its highest price in five months, and sells when it falls back to a two-month low. Strength is bought; weakness is sold.
- Trades
- shares, held for days
- Holds
- weeks to months
- Worst case
- limited by a stop
Swing mean reversion
Buys big, well-known companies after an unusually sharp fall and sells once the price has recovered a little. Slow, patient, and the only kind here that holds overnight.
- Trades
- shares, held for days
- Holds
- days to a few weeks
- Worst case
- limited by a stop
Trades the day, then stops
In and out between the open and 15:15. Nothing is held overnight, and a stop limits each trade.
Intraday exhaustion scalp
Fades extreme intraday panic and euphoria when a large stock stretches beyond a 2.5-standard-deviation hourly band and RSI reaches 20 or 80, then closes by 15:15.
- Trades
- shares, within the day
- Holds
- closes the same day
- Worst case
- limited by a stop
Intraday trend, long and short
Follows the direction of large stocks within the day, buying when they turn up and selling short when they turn down, so it has something to do on falling days too.
- Trades
- shares, within the day
- Holds
- closes the same day
- Worst case
- limited by a stop
Supertrend and VWAP trend
Buys a large stock when it turns upward and the day's buying confirms it, sells when the turn reverses, and does nothing on days with no clear direction.
- Trades
- shares, within the day
- Holds
- closes the same day
- Worst case
- limited by a stop
Opening range breakout
Buys a large stock when it climbs above its first-fifteen-minutes high on strong volume, hoping the move carries through the morning. Many small losses, fewer larger wins.
- Trades
- shares, within the day
- Holds
- closes the same day
- Worst case
- limited by a stop
Open-ended risk
Bigger premiums, no ceiling on the loss. For people who already sell options and know what a gap does.
Short strangle
Like an iron condor without the insurance: more premium, more room for the index to move, and a loss that has no ceiling if it moves a long way. For experienced options traders.
- Trades
- index options, income
- Holds
- closes the same day
- Worst case
- no ceiling
Weekly short straddle
Sells a call and a put at today's level and keeps the premium if the index barely moves. The biggest premium of any strategy here, and the least room for error.
- Trades
- index options, income
- Holds
- closes the same day
- Worst case
- no ceiling
Which should you try first?
If you would rather own shares than trade options, start with market mode or the long-term trend: both buy and hold the way a person would, with one rule for when to sell. If you have never traded options and want to, the iron condor: its worst case is known before the trade is placed. Any of them can run with pretend money against live prices, which is the only honest way to find out whether you can live with how a strategy behaves.