Buy DLF 280 strike call at around Rs 4.8 advises Trivedi

According to him, Amit Trivedi, Director of Fin Stream Financial Advisors, traders and investors can buy DLF Rs 280 strike calls at around Rs 4.8 and sell Rs 290 strike calls at Rs 3.

Trivedi told CNBC-TV18, “What is happening is given that Nifty volumes are at around 12 percent, you have individual stock option volumes at a much higher level. DLF is at around 45 percent, so we have a strategy there. The company has a board meeting today to discuss the sell proceeds part of it. DLF has moved in the band between Rs 250 at the lower end and Rs 280 on the higher side.”
“So, we think traders and investors can buy Rs 280 strike calls at around Rs 4.8 and sell Rs 290 strike calls at Rs 3. There is an initial cash inflow of Rs 1.20 in this trade, which translates to Rs 1,200. You will start taking losses if DLF moves beyond Rs 300, which is approximately 18 percent from current prices of Rs 255-260. Your maximum profit will be if DLF goes to around Rs 290, which is Rs 10. Even if DLF remains here you make at least Rs 1.20 in this particular strategy,” Trivedi added.