Start Options Trading with 1000 Rupees: If you are a beginner and you want to start options trading with ₹1000 which is a very good approach. If you would like to trade in options then you don’t need to have a big capital like 50k or 1 lakh, only then you can trade in options.
Many professional traders say that you should initially put ₹ 1000 in your funds and start trading in options and not enter with big capital.
The reason for this is that when you come to trading with a capital like 50k or 1 lakh, you will make a mistake and if you lose this big capital within a month, then you will be very sad because the amount like 50k or 1 lakh is very big for a beginner.
But at the same time, if you come with ₹1000 and even if you lose ₹1000 in a month, then you will not have any problem and you will not be sad, by losing such ₹ 1000, you will learn a lot about option trading.
Many new traders think that they will trade in options with big capital and will trade with more lots and make profits, which is unrealistic. The less funds you start with in options trading, the more you will be able to progress.
So today in this article, we are going to teach you how to do options trading with ₹1000, ₹100 and even ₹500. What needs to be done for this, we are going to teach you all this in this article.
Can I Start Options Trading with 1000 Rupees?
Many people think that can we do options trading with ₹1000? You must be thinking, how can one trade in indices like Bankifty and Nifty with just ₹1000 because the premium of Banknifty is around ₹200 to ₹250 and the premium of Nifty is around ₹75 to ₹100.
So we need around ₹5000 to trade in options, so every new trader or beginner can do options trading that too with small capital like ₹1000, but you can do it only in 3 scenarios:
1) OTM (Out-Of-The-Money): You can trade in options by buying in OTM. Suppose the price of Bank Nifty is 49,600 and if we take a call or put of 50,000, then we will easily get its premium of ₹40 or ₹50, that means we can do option trading even with ₹1000 in ATM.
2) Options Buyer: If you want to trade in options with small capital like ₹1000, then you have to become only option buyer because in option buying you can trade with a lower margin also.
3) Expiry Day: In options trading, there is an expiry of indexes every day, which is very good for those who want to trade in options with small capital. If you have funds of ₹1000 and you want to trade with it in ATM (At-The-Money), then you should trade on the expiry day only.
But if you are an options seller and you like to do options selling, then it’s not possible with ₹1000 because a seller requires a capital of at least 1-2 lakh rupees to trade.
Options sellers face higher risk due to the volatility of the underlying asset and sellers mostly go through with the contract, hence options selling with just ₹1000 is not possible. [Start Options Trading with 1000 Rupees]
Read Also: 10 Great Ways to Learn Option Trading in 2024
Points to Consider Before Trading with 1000 Rupees:
1) Choose the Right Broker
If a beginner wants to start options trading, that too with a small capital like 1000 rupees, then you should always choose a right broker who provides low brokerage fees to the traders and has a beginner-friendly platform.
You have to select a broker that supports a user-friendly and provides educational resources. Then you have to create your trading account on the selected broker and you have to deposit your ₹1000 capital with such a broker and then you can trade in options.
2) Solid Understanding of Options Basics
If you like to trade options, then it’s very important for you to have a solid understanding of options basics and how the market works. Understand the basics of options trading including call/put options, premiums, strike prices, expiry dates, etc.
You have to learn different strategies such as buying calls & puts, selling covered calls and spreads before engaging in options trading.
3) Starting Small
Even if you have small capital, still it’s recommended that you find options which have lower premiums and fit your capital, that means you can go with OTM (Out-Of-The-Money) options which are a little riskier and also cheaper.
You should always start small in options trading because it’s very risky. It’s very important that you strictly follow your risk appetite and trade with only one or two lots. [Start Options Trading with 1000 Rupees]
4) Define the Target Prices & Stop-Loss
If you start options trading with ₹1000, then you must always use stop-loss orders because with such a small capital, if you want to stay in the market for a long time and save your capital, then you must use stop-loss.
While trading, you have to analyze your stop-loss and targets because by doing this, you can effectively minimize your losses and maximize your gains.
5) Paper Trading
If you are a beginner and want to learn about options trading, then you can learn through paper trading. By using paper trading, you can learn about options trading without risking real money.
If you start option trading with ₹1000, then you will neither get much profit nor much loss. That’s why you should start with paper trading because in this, you can learn many types of strategies, gain experience and improve your trading skills without investing any money. [Start Options Trading with 1000 Rupees]
Read Also: How to Become an Expert in Options Trading 2024?
Can I Start Options Trading with 100 Rupees?
Often new traders have a question about how much minimum money is required while starting options trading? For your information, let me tell you that if you are talking about taking trade in options, then start trading even with limited capital like ₹100.
But you will not get any kind of benefits in this because even if you start options trading with ₹100 and your money gets doubled, then you will not get any satisfaction from that ₹200, whereas even if you lose the entire ₹100. This means that even if your 100% capital is gone, it will not make any difference to you.
Because if you want to trade in options with ₹100, then you will have to trade in OTM (Out-Of-The-Money) which is very risky and in this, you get the premium also very cheap due to which they increase slowly because their delta is very low. You get profit only, if you trade with more lots, otherwise you will end up paying brokerage charges for just 1 or 2 lots.
If you want to make a career in options trading, then you have to focus more on your learning than money, and even big experts suggest that for the first 3-6 months, learn options trading only by paper trading, until you are profitable. If it does not happen, you have to keep extending this period. [Start Options Trading with 1000 Rupees]
Read Also: Top 11 Common Options Trading Mistakes to Avoid
Can I Start Options Trading with 500 Rupees?
If you are a beginner and want to start options trading with ₹500, then you should start with Nifty 50. When you start making profit, gradually your experience increases and only then you can trade in Bank Nifty. But if you are a new trader, you should first start options trading with Nifty 50 only.
For a new trader, the expiry date, call/put prices and strike price are very important. If you want to trade options with ₹500, then you should simply trade around the expiry date because as the expiry approaches, the price of all the contracts becomes less and you can buy & sell them cheaply.
Starting options trading with ₹500 is extremely challenging because it involves a lot of risk. Starting options trading with a limited capital like ₹500 is theoretically possible, but it’s very difficult to grow with this small capital. [Start Options Trading with 1000 Rupees]
Conclusion
In Conclusion, we hope that this doubt has been removed from your mind whether we can trade in options even with small capital like ₹1000, ₹500 and ₹100 or not? With such limited capital, you will not get much benefit but if you trade with more lots, then only you will get benefit.
Yes, it’s possible to start options trading with just ₹1000 and ₹500, but you will have to face some challenges and limitations in this. You should only learn with such a small capital, don’t think about making profits from it. You just think about saving that capital and learn trading from it.
Starting small, choosing the right broker, starting with paper trading, defining the target prices & stop-loss and developing a trading strategy are the key practices that can help you become a successful options trader.
I hope you have liked the information we have shared in this article, to know more about options trading you can read our other articles too. [Start Options Trading with 1000 Rupees]
Read Also: How to Make Consistent Profit in Option Trading 2024?
FAQs –
1) Can a beginner trade in options?
Yes, a beginner can trade options but it’s very important to approach it with caution and a solid understanding of options basics and how the market works. Options trading is very risky and complex, hence beginners should trade with proper strategy, setup and risk management.
2) How much money do I need to start options trading?
There are many people who come with a capital of 10k or 15k and start trading in options. What happens is that they double their 10k capital in a day and then one day comes that they end it all.
Every successful trader says that when you enter into options trading, try to save money instead of earning money. Understand the behavior of pricing, understand the price action and then after that, you can trade in options. But if you want to trade in options then go through bull call spread, bear put spread, hedge and the minimum capital required in these is 25k-30k.
3) Can I do options trading with 5000 rupees?
Yes, anyone can do option trading with 5000 rupees. For this, you need to have a deep understanding of the options market and a solid strategy. Options trading is very complex and risky, hence it would be advisable that you trade in options only after learning from experienced traders.
4) What is the trick for option trading?
The best trick for option trading is that you should always develop your trading plan because option trading is very complex and risky. So, when to enter & exit and where to set stop-loss, all should be defined in your trading plan.
5) Can I do option selling with 1000 rupees?
Option selling with 1000 rupees, it’s not at all possible. If you are an option seller, then you should have a minimum capital of 1-2 lakh to trade.
Fine topic.