Monday, March 8, 2021

Bull Spread strategy on Britannia by Nandish Shah of HDFC Securities

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Bull spread Strategy on Britannia


Buy Britannia Jan 3650 Call at Rs 54 and simultaneously sell Jan 3800 Call at Rs 15



Lot Size: 200


Cost of the strategy: Rs 39 (Rs 7,800 per strategy)


Maximum profit: Rs 22,200 if Britannia closes at or above 3,800 till 28 Jan expiry.


Breakeven Point: Rs 3,689


Rationale:


— Long build-up was seen in the Britannia Futures’ where we have seen a 4% rise (Prov) in the Open Interest with the price rising by 1 per cent


— Short-term trend of the stock has turned positive where the stock price is trading above all important short-term moving averages


— Oscillators like RSI and MFI are showing strength in the stock


— The stock price is taking support at 200-day EMA since many months



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Disclaimer: Nandish Shah is Technical Research Analyst at HDFC Securities. He doesn’t hold any position in the stock. Views are personal.

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