DERIVATIVE TIPS AND TRICKS FOR THIS MONTH (OCTOBER 2010)

IF THE PREMIUM ON NIFTY ;FUTURES IN OCTOBER AND NOVEMBER SERIES IS ANY INDICATION, MOST OF THE SHORT COVERING HAS ALREADY TAKEN PLACE AND THE UPWARD MOVE TRIGGERED BY THE ;SHORT SQUEEZE IS OVER.
THE OPEN INTEREST IN THE MARKET INDICATES CREATION OF MORE LONG POSTIONS THAN ANYTHING ESLE.

THE SEPTEMBER SERIES, WHICH SAW A SHARP UPWARD MOVEMENT IN NIFTY, DID SEE SOME PROFIT BOOKING ON THE DAY OF EXPIRY. BUT THE DECLINE WAS NOT SHARP, WHICH INDICATES THAT THE MAKKET IS STILL IN STRONG
HANDS.

THE OCTOBER SERIES HAS STARTED ON A STRONG NOTE WITH MORE THAN 2 PERCENT GAINS IN A SINGLE SESSION. ONE REASON FOR THE SRONG UPOWARD MOVEMENT WAS FRESH BUYING BY INVESTORS, WHO HAD BEEN SITTING ON
THE SIDELINES AND WAITING TO SEE IF THE AYODHYA VERDICT HAS ANY MAJOR NEGATIVE REACTION, THESE ARE NOT ONLY DOMESTIC INVESTORS. EVEN A SECTION OF FII'S WERE WATCHING THESE DEVELOPMENTS KEENLY.

AS FAR AS THE DERIVATIVE MARKET IS CONCERED, THE COST OF PUT OTPIONS IS SHOWING THAT WITH EVERY PASSING DAY, MORE AND MORE PEOPLE ARE GETTING CONVINCED THAT THE MARKET....

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