Best bank nifty future trading strategy for beginners in Indian stock market

1. Best bank nifty future trading strategy for beginners in Indian stock market

2. Before going to Bank nifty trading strategies traders should first know the basic of future derivative trading, its lot size, expiry date etc. It is very popular among Indian technical trader. It is most liquid and highly volatile contract in Indian stock market. Option trading in Bank nifty is highly profitable. So we will discuss here how you can trade comfortably in futures and where you can learn live strategies with accurate technical trend? We will discuss future trading strategy with example below. Bank nifty is comprised of 12 most liquid banking stocks. It acts as trend setter for Nifty. Future is a derivative contract which is derived from an underlying asset and here underlying is Bank Nifty. Future is available in three types- current month, mid month and far month. It has lot size of 20 and each month last Thursday is its expiry date. It also has weekly contracts which expire on every Thursday. Contract value -29500*20= Rs 590000.

3. Here advantage is low margin required for intraday which is around Rs 20000 required for intraday trading and in cover and bracket order Rs 12000 is required to trade. Unlike stocks, trader can short position in Futures and keep it till expiry. This is the biggest advantage. You can learn Bank Nifty Future technical trend posted daily before market open @8.45 am. Now we will discuss taking different examples. Example 1 To trade in index future or in Nifty, trader should have good knowledge of technical analysis and getting daily trend in Bank Nifty Today helps trader to find trend first. After getting trend trader can get entry point and exit points. Let say technical analysis indicating trend is positive. In micro time interval you should search for better entry point to buy index future. Here you got 60 point and sold it. Here profit is 20*60=1200/-. Similarly if trend is negative, you short Bank future to get 40 points then profit is 20*40=800/-. Here imagine how easy it would be if you could find BankNifty Future trend before market open.

4. Example 2 • Let’s say you have position in banking stocks and market showing bearish trend. In this case it is used to hedge against banking stock delivery. Technical trader uses it extensively in case of Options trading to hedge their position. Analyzing BankNifty Today generally helps trader to get trend much before and apply strategy. Let say you have bought “CALL” option and suddenly Nifty changed its trend to down with volatility. What should you do here? This type of trend change generally leads to huge loss. Here you can hedge by shorting future of Bank nifty against option to protect principal amount and after some practice you can make profit there. • Why trading in Bank nifty is easy compared to stock? • You have to concentrate in one only and easy to do technical analysis. In stocks you have to search and do technical analysis in each stock which is difficult and time consuming. • Most liquid script in Indian stock market. • Hard to manipulate. • Not prone to crash unlike stocks. Thus makes it safe trading contract as compared to stocks. • Lesser margin required. Due to less volatile margin requirement is between 12-15%. In case of stocks margin can go up to 40-50%. • It generally influence trend of Nifty. Thus it is used as a better indicator to find market trend.