Buy Glenmark Sept 1060 Call around 38: Way2Wealth

Glenmark Pharma Option Strategy by Way2WealthGlenmark has corrected by almost 20% in last 2 weeks and in this process stock breached its crucial support area of 1000 levels in intraday session. However, stock managed to close above the same and from those levels, it has witness good pullback. We are expecting that Glenmark will continue to see this short covering rally and on higher side can test 1100-1140 levels in short term. Therefore, we recommend executing below mentioned strategy at current levels. Strategy DetailsThe strategy consists of buying 1 lot of Glenmark Sept. 1060 Call option at Rs.38 and selling 1 lot of Sept. 1100 Call at Rs.24 and 1 lot of 1140 Call at Rs. 15. The premium inflow in this strategy would be 1. Initial inflow is estimated to be Rs.250 at the time of initiation of strategy. Profit and Loss Matrix:Maximum Profit will be Rs.10250 if Glenmark closes between 1100 and 1140 levels whereas there will be no loss if stock falls below 1060 and closes below that. However, if stock breaches 1180 levels on higher side, than one need to hedge the positions by buying 1 lot in Futures.Leveraging CostThe SPAN margin of complete strategy is 39,500 at the time of initiation and may vary depending upon the volatility in the market.Strategy:Buy 1 lot of Glenmark Sept. 1060 Call around 38Sell 1 lot of Glenmark Sept. 1100 Call around 24Sell 1 lot of Glenmark Sept. 1140 Call around 15For all recommendations, click here Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

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