Expiry Day Nifty Option Strategy for 50X Return

Expiry Day Nifty Option Strategy

I have received requests from many traders to teach them a strategy to trade the expiry day. I will discuss a very simple expiry day nifty option strategy that can safely fetch you 20 times to 50 times even 100 times returns. This strategy can be implemented on Nifty OR Bank Nifty options.

FAQs on Expiry Day Trading

What is expiry day in stock market?

In the Indian stock market, monthly futures and options for stocks and indices expire every last Thursday of the month. So traders need to settle their positions before the expiry of the contracts. Nowadays, the Nifty and Bank Nifty index has a weekly expiry. So the weekly contracts of the indices expire every Thursday. This provides a trading opportunity for active traders every week. In case Thursday remains a holiday the expiry takes place on the previous trading day.

Can I trade options on expiration day?

Yes, you can safely trade options on the expiration day. The only things you need to know is how to execute options trades correctly and the correct range in between which the market will expire.

What happens when calls expire?

When the calls expire they are no longer in the system. If they expire above the strike price that you purchased, it will be sold and you will get the last premium multiplied by lot size minus any brokerage and taxes paid. On the other hand, if the call option expires below the strike price that you have purchased you will lose the entire premium multiplied by the lot size and any brokerage and taxes paid.

What happens if I don’t sell my options?

In case you hold the options and they expire worthlessly you just lose the entire premium multiplied by the lot size plus any brokerage and taxes paid. But in case these options expire in the money you need to pay more taxes and STT and that will hamper your profits. Hence, it is advisable to always square off any in-the-money options before expiry.

Points to Remember on Expiry Day

Remember expiry day is a critical day to trade where actually the market remains very noisy. If you trade with a chart, you can face many whipsaws on an expiry day. You can often see that trend-following indicators are generating a buy signal and the market is falling down on the next bar. The same can be true for a sell signal also.

Many traders lose money on expiry day. But there can be an immense profit if you can trade expiry effectively. In fact, the stock market is like a sword. You need to know how to handle it properly.

Yes, this strategy can make your 1 rupee grow to 20-50 OR even 100 rupees in no time. This is the power of the expiry day nifty option strategy. You need not be a big technical analyst to trade Nifty on the expiry. The only knowledge you know is where actually Nifty is expiring.

Collect Correct Options Data For Expiry Day Nifty Option Strategy

You first need to collect options data to understand exactly where Nifty is going to expire. You may not get the exact level, but you will get a band within which the Nifty is going to expire. For that login to the Open Interest page for the Nifty index on our website.

Just open this page on the expiry day morning. Concentrate on the first image. Locate the point when the last time the red bar is longer than the blue bar and the first time the blue bar is longer than the red bar. The red bars are put open interest and the blue bars are call open interest. See the image below:

Nifty Open Interest Chart

Here 9400 is last when put open interest is greater than call open interest. So the expiry will be above 9400. And 9500 is first when to call open interest is greater than put open interest. So the expiry will be below 9500.

The Expiry Day Trading Game

Now, keep 9400CE and 9500PE of same month expiry in your terminal. The real game starts after 1:30 PM. If you get Nifty below 9400 simply buy a 9400CE. You will get it for 1-5 rupees. Nifty will be 100% rise above 9400 and you can get 10/20/50 even 100 rupees of your call option.

Similarly in the expiry day nifty option strategy if you get Nifty above 9500, you know Nifty will not expire above 9500. So simply buy a 9500PE. You will again get it within 1-5 rupees. Nifty will 100% fall below 9500 and you will get big gains.

Money Management for Expiry Day Nifty Option Strategy

Do not trade more than 2% of your capital in this strategy. Because there will be no stop loss. Your maximum loss in this expiry-day nifty option strategy will be limited to the premium you are paying for the option. You can also refine Nifty expiry levels using the 50-point open interest values like 9450. In that case, you need to trade 9450 calls OR put.

Expiry Day Trading Strategy in Bank Nifty Options

If you want to trade Bank Nifty in this strategy please visit the Bank Nifty Open Interest page. The same kind of expiry play is possible in the Bank Nifty index as well. Moreover, due to higher volatility, Bank Nifty offers a better trading opportunity to active traders. We recommend you bookmark our Nifty and Bank Nifty open interest pages. We are now offering full interactive charts on these pages.

Using Options Max Pain Strategy in Expiry Day Trading

We can also use Options Max Pain in predicting the expiry value. There is a Max Pain calculator on our website. This page will update the Nifty and Bank Nifty options Max Pain in real time.

Nifty Max Pain

Now, what this Max Pain indicates? This indicates the level where if the market expires, the options buyers will have maximum pain. In other words, this indicates the expiration levels. Suppose on the 28th November 2019 expiry morning we have seen that the May Pain is around the 12100 level. So we understood that the expiry will happen near 12100. So in the early trades when the market was trading at higher levels we could enter a short sell for a target of 12100.

Suggested Reading

I suggest reading the following book: Trading Options at Expiration: Strategies and Models for Winning the Endgame (paperback). This is a complete guide on how to trade options on the expiry day.

Conclusion

Trading in the expiry can be a really profitable business if you can predict the expiry level correctly. Many traders lose money on the expiry day. But this day is a money-making opportunity for options traders. Money can be made both by buying and selling options on this day.

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Author: Indrajit Mukherjee

Indrajit is a professional blogger and trading system developer. Amibroker expert, Wordpress expert, SEO expert and stock market analyst.Trading since 2002, he has started the journey of StockManiacs.net on 2008. He follows Indian and world stock markets closely.

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Satish Manjar

What is the accuracy of this strategy?
What if the option is ITM at 1.30 pm? Then we wont get it at a cheaper rate

Satish

Thanks for the reply. Wanted to test the strategy today. BN the range is changing from the morning i.e before it was 200-300, 300-400, 400-500 and now again 300-400. So which range to trade for at 1.30 pm?

yasir

sir what about STT trap??? how
to escape from it

yasir

Thank you sir with your quick reply,just one more question that if i bought 20 lots of nifty option on an expiry date AT THE MONEY and somehow they are expiring in IN THE MONEY options so is it hard to sell before closing of market.because lots is 20 and in the money

Anil

Sirji
This strategy would work only in monthly expiry or even weekly

Meenakshi

I don’t think there is STT anymore.

yasir

seriously??

Sajeev

Hi Indrajit,

Many thanks for your openness in sharing this strategy. Just a doubt since this is a buying the option strategy how to overcome the STT disadvantage since for the Nifty 7 – 8 Rs would be going towards STT on expiry if the option is exercised.

Thanks.

Sajeev

kensington

Totally misleading article. Dont even try it if you value your money

Sunil

Great!!! Dada, You have done “Big”Research and sharing for benefit of others…….one shouldn’t mind loss/profit as that support/resistance comes from Nature

Ashok kumar

Hi indarjit sir,
Please explain ITM and OTM option by example in respect of nifty.

Ashok kumar

As u written actual game start after 1:30 pm.
But opent interest chart change since morning every time. Which time we have to consider red and blue bar.

Pradip

Mr. Indrajit…same question here…
please explain what time we consider red and bule bar…..
at monring or after 1.30 pm

Pradip

Hi,
can i get Historical “Nifty Open Interest Charts….” for study purpose..
….as per your advice 25 jan expiry
i take 11050 ce & 11100 pe
bank nifty
27300 ce & 27400 pe
……………….its worked………..great

Ashok kumar

Is this strategy applicable for bank nifty?

wealthcreationbysahil

Dear Sir, can you tell me where can i find the weekly expiry OI charts?

wealthcreationbysahil

Thank you for the reply

Ashok kumar

I Checked yesterday for bank nifty exp since 2 har up to market closing. Red bar was at 25500 and blue bar at 25700. But bank nifty never came below and above this level. It was moving in between at 25560, 70, 80 like this. Then what is the strategy for trading at exp day.

Pradip

Mr. Ashok check exp. of the 25-01-2018….its happen

Parveen Kumar

Please tell me bank nifty option selling strategies at the time of expiry.

Parveen

Sir how to read option chain and what is OI

Tej

From Oct 2018 expiry is going to be at 11:55pm, then what’s the time frame u are going to check OI ? Thanks

Zafar

This didn’t work in the last two week BNF expiry i.e. 24th and 31st May. The OI level kept on changing till the end. Was this due to the HDFC news?

Zafar

Yes, it did work twice/thrice. The only problem is that it is difficult to restrict loss during the last 30 minutes due to wild movement. Trying to figure out how to place correct stop loss and not lose out on gains as well.

Sahil

Should we trade using this strategy tomorrow as there was a RBI decision today. Or during swings, we should be away?

sonu

Please write strategy for call/put writers on expiry day

Nikhil Singh

Hello sir !!

Thanks for the strategy . I am excited to try this .

The open interest data that we will be looking at is showing oi on the day of expiry at every hour ?

or it is overall open interest of call and put of overall month ?

shyam

What if there are no buyers for ITM call options after 2 pm. Dont you think there is risk of buying ITM options on expiry day?

shyam

Sir,

What i wanted to say was ITM options are quite expensive. Say if we are selling expensive ITM options are there ppl who will really buy this? Its just a query as i started traing in oprions recently. I am no questioning you strategy.

Sandeep

indrajit this strategy really amazing. How I can contact you for more such strategy

arvindmurthy

sir i need expiry day statergy please provide ….

Pankaj Bhowmick

today your streategy did not work . also i saw open interest keeps live chart keeps changing so it is hard to select right strike price . i will follow up coming expiry also .

Pankaj

BN open interest was live.BN was never below 27300 after 1.30 pm .anyway there was no big move after 1.30 either way

Pankaj Bhowmick

sorry i could not understand that i have to check open interest after 1.30 and ope interest data is live . i will check next week . this week no trade triggered .

amit kumar keshri

HI SIR, WHERE FIND OPTION OI CHART WITH CANDLE PATTERN

Anil Ugale

Dear Sir, this strategy is very interesting thanks for this, but one thing i am not understand pl explain how to identify- first time blue bar is longer than red bar

karan verma

you said buy at 1.30.
what if we buy and then we do not get seller at when we want to sell?

umapathi

Great information , you opend for every one.

Arvind Dholakia

Can we use this strategy in the morning everyday to trade Nifty? If not, how do we decide whether to buy Nifty PE or CE and at which strike price?

brajeswar

Thank you Indrajit for the discussion of strategy.It will help a lot.
Could you please elaborate last and first bar…what does it mean? Meand the first and last bar from spot price where we have more OI? Please help to understand.

Suprio Nandy

Mr. Inderjit, I tried your strategy on 30/05/2019 on Nifty.
Max Pain was showing at 11650 from 1.30 to 3.30 pm.
But Nifty closed at 11900.

How does your strategy work in such a situation?

Suprio Nandy

I was Trading at 11900 while your MaxPain showed 11650.

This is the very point that the Max Pain has no reliability.
The FII Don not trade on the standard Max Pain calculation. Their strategy is confidential.

Therefore, the strategy can not be used since the Max Pain strike is not the expiry strike price.

This strategy is misleading, and should be removed.

Atul

Where can we find this nifty open index charts or bars

nitesh agrawal

i cannot understood your straitgey is it available in hindi

AMBALLA JANARDAN

IN OPEN INTEREST OF NIFTY AND BANK NIFTY, WE SHOULD SEE TOTAL OPEN INTEREST OR CHANGE IN OPEN INTEREST ON THE EXPIRY DAY?

Saravanan

Dear Sir, This is about supertrend. when 30 minutes trend is in BUY mode, you recommended to Buy in 5 minutes chart whenever it signals. Pl clarify, can i sell in 5 minutes trend till a buy signal comes in 5 minutes chart.

Shubhanika

Sir
Really your option expiry strategy is a magic.
Thanks

Swati

Hi sir thanks a lot for the option expiry strategy

Shubhanika dhal

Sir
For expiry day.
Which strike should be selected? Should the selected strike be near the spot? Also should one be safe if he invest same amount in buying both ,Suppose Nifty 11000PE and nifty 11000CE ,When nifty spot is very near to 11000 . Can you guide us sir.
Regards

Shubhanika

VIDYADHAN GEDAM

Hi, last September expiry 10850 PE moves from 2.0 above 40 and close at 44. I was sitting on terminal and 3-4 times 10850 PE comes to 2 and move to 20…

I just want to know if I bought it at 2 and not sell it myself, what happens? Is it closed at 44 with huge profit or close at 0.05 with loss of premium.

Pls revert with your we whatsapp number.

Vidyadhan Gedam

Hi Sir, last 2 weeks these strategy is not working. Please explain

Avi

Can you tell me how to use and trade this tool

Alok Jauhari

Thank you very for sharing such wonderful techniques. But when I downloaded the excel sheet through the given link I got the very old sheet. Please suggest how can I download the latest data? thanks in avdvance.

ashu

hello, i applied this stratergy last thursday and earned about 1500 on bank nifty on capital of 2500, u said trade this after 1.30, and when at proper levels, when should i exit?

and any other tips regarding this stratergy?

Rajib Das

Hello Indrajit, had a query if BankNifty Max pain on weekly expiry is at 35120 in the morning and Max pain is at 35400 shown so will the Call prices become bullish and after 1:30 PM when there is no time value the premiums of 35100 for example bought at say Rs14/ will suddenly go up .

Rajib Das

Alsso adding to the previous question if Max Pain for Nifty is at 16650 CE,OI change addition is highest at 16800 CE at 101,000 and Nifty is trading at 16620,with OI increasing to 17000 then tapering to negative so can we say that traders are adding position for the day and may see markets going up,all this is for date 3 March 2022 at 10:45 am
Also adding to the previous question if Max Pain for Nifty is at 16650 CE,OI change addition is highest at 16800 CE at 101,000 and Nifty is trading at 16620,with OI increasing to 17000 then tapering to negative so can we say that traders are adding position for the day and may see markets going up,all this is for date 3 March 2022 at 10:45

Last edited 2 years ago by Rajib Das
Rajib Das

Hello Indrajit,

Is there any web recordings where I can understand the expiry strategy better.Would really appreciate the same

Kannan

“If you get Nifty below 9400 simply buy a 9400CE. You will get it for 1-5 rupees. Nifty will be 100% rise above 9400 and you can get 10/20/50 even 100 rupees of your call option.”

I don’t see how you can make even 10 paise with this strategy. With the expiry time so near, the option premium will be exactly equal to the difference between the option strike and the underlying’s price. So if Nifty dips Rs. 10 below 9400, i.e. when it is at Rs. 9390, you will be able to buy a 9400 CE at Rs. 10, but when the price goes up to Rs. 9391, the option’s price will be Rs. 9, and at Rs. 9399, its price will be Rs. 1, and at Rs. 9400 it will be 0. You lose 100% of your money, can’t make a paise with this strategy.

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