LT

L & T
LT is in downtrend.

Bear spread strategy for LT.
Buy 1380 PUT of April expiry between 38.50-39.25 and Sell 1360 PUT of April expiry between 31-32.
Maximum loss could be 1700 to 1800 if LT changes the trend.
Maximum profit could be 3100-3300 if LT closes below 1360 at expiry.
One should not wait till expiry and book profit as soon as there is 2% gain over the investment. This could be possible if LT reaches 1360 in next 10 days.

To insure against potential loss of 1700 in above bear spread strategy,
Sell LT 1580 CALL of April expiry @ 4-4.5. The chances of LT crossing 1580 before April expiry is just 10%. One should able to get Rs. 1000 out of this trade and should cover the potential loss from above bear spread strategy.

In short there are three trades:
Buy 1380 PUT of April expiry between 38.50-39.25
Sell 1360 PUT of April expiry between 31-32.
Sell LT 1580 CALL of April expiry @ 4-4.5.

Maximum profit about Rs. 4500 and maximum loss (assuming there is 90% probability LT will not cross 1580 before last Thursday of this month) could be Rs. 700-800.
Total investment in these three trades could be about Rs. 60000/70000 depending upon the broker and chosen brokerage scheme. So this is 7 to 8 times bank interest and this is worth taking risk.

I reiterate one should exit once LT touches 1360 and book profit. One need not wait till he/she gains full Rs. 4500 by end of the month.

Low risk takers should only do following.
Sell LT 1580 CALL of April expiry @ 4-4.5.
It will be easy gain of about Rs. 1000 on about Rs. 25000 investment as margin money.

 Disclaimer: This blog does not take any responsibility of your profit/loss