What to Trade on General Election Result Day 2024?

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Of late, I have been getting a lot of WhatsApp messages and emails on what to trade on the expiry day. I can understand the eagerness to make money, that’s good but no one is looking at the other side of the coin.

The Risk Involved!!!

One thing is certain you will not make 1 lakh profit on the election result day, not even 50k, even 25k looks impossible… probably 2k to 3k is what you will be able to make. Is that justified against a huge risk of all the margins blocked for the trade?

I mean on that day (General Election Results Day – 4th of June 2024) – the real joy is watching the Television News Channels showing the voting numbers, analysis, chat shows, winners and losers candidates etc, not trading to make or lose 2k.

I do not see any fun even for a man desperately needing money to trade on the results day. Some days the risk factor is so high that it’s better not to trade.

You can easily guess the risk factor by looking at INDIA VIX which is currently at 22.86, well above normal (17 or below).

The higher the INDIA VIX the higher the risk.

What to Trade on General Election Result Day 2024?

Here is one trade that can be done if you cannot stop the urge to trade on Tuesday, 4th of June 2024 – General Election Result Day 2024.

Make sure it is Intraday only as INDIA VIX will most probably fall more than 10% intraday which will in turn crush the theta (time value) of the options by more than 10%, however, the delta will still be there so a small risk can be taken.

Here is the trade:

Buy a 5% up Call Option and a 5% down Put Option of any volatile stock or Index not expiring in the same week. This means the options you buy should expire only after 4+7 = 11th of June 2024. Keeping a few days in hand will ensure that theta decay will not do too much damage if there is no movement.

For your information, theta (time) decay is most of the options that expire first from the day you are trading.

Do not sell options or trade futures on the result day. The movement will be hard to manage.

What to do next?

Book profit on the side that gives 20% return then wait for a bounce back or keep an SL (Stop-Loss Order) for that side of double the profit you made. For example, if you made 2k on the call side, then kept an SL of 4k on the put side or exit at cost to cost.

Do not try to make a profit on the side which is open. Just exit at the cost you bought the option.

Do it early in the day else you may miss the profit on one side which will make the trade difficult.

So with this trade, you either make 2000 or lose 2000. That’s it – no extraordinary effort is required. Let me guarantee you one thing if you try to be smart on that day using any technicals, you will end up losing money.

Some days are just not meant to be traded. Even the best technical analysis will not be able to give you any high-probability signal to trade. If you still want to trade on the results day then I have given you a good idea. Please do not mess with the idea given above. Just try it and be happy with the outcome.

Hope that helps.

Disclaimer: The above is not an advisory service. It’s just a trade idea with low risk. 

You can also read:
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