Straddle, combined SL & target
This intraday straddle manages the call and put as one position. It sells the NIFTY ATM straddle at 09:20 and watches the combined premium: if it falls 20% the trade is closed for a profit, and if it rises to one and a half times the credit, it is stopped. After either exit, a fresh ATM straddle is sold, up to three a day. The idea is to bank decay in small, repeatable pieces.How it trades
Results
PRE-BUILT · DEFAULTSWhere it made and lost money
Because both legs are judged together, this straddle behaves the way textbooks describe, unlike per-leg-stop versions. On quiet sessions with a range under 0.75% it made ₹1,46,949 over 148 trades with an 84% win rate: the combined premium decayed steadily to the 20% target, often more than once a day. On trend days that closed near their high or low it lost ₹93,408 over 112 trades, as one leg's gain outran the other's decay until the 1.5x stop fired, and a re-entry could be stopped again. Tuesday expiry days, with the fastest decay, made ₹48,662 over 145 trades, against ₹7,577 on all other days.
About this strategy
- At 09:20, sell one lot each of the ATM call and put of the nearest NIFTY weekly expiry.
- Track the combined price of the two legs against the credit received.
- Close both legs together when the combined price falls 20% below the credit (target).
- Close both legs together when the combined price reaches 1.5 times the credit (stop).
- After a target or stop, sell a new ATM straddle one minute later, up to three straddles a day and none after 14:30.
- Close anything still open at 15:15.
Why traders use it
Watching the combined premium means a move against one leg is partly offset by the other leg's gain, so the position is not stopped on a modest one-way drift. A modest 20% target is reached often in calm markets, and re-entering at the new ATM strike resets the straddle around the current price. The rules are simple and suit traders who prefer one number to watch rather than two separate legs.
The year in plain words
From 1 Oct 2025 to 30 Sep 2026 on NIFTY the strategy sold 365 straddles, won 69% and made ₹60,284 before costs, a profit factor of 1.20. After ₹20 per order and bid-ask slippage ₹23,961 remained. Most trades, 189, ran to 15:15; 132 hit the target and 44 the stop. Typical of short premium, average losses of about ₹2,750 were nearly twice average wins of about ₹1,460, and the worst trade lost about ₹12,950. November 2025 was the best month at ₹26,552 and October 2025 the worst at a loss of ₹11,410. Costs took well over half the gross profit.
What the settings do
Risks
- Both legs are naked, and on a strong trend day the loss can exceed the planned stop in a fast market.
- Re-entries on a trend day can stack up to three stops in one session.
- With about 30 straddles a month, costs consumed more than half the profit before statutory charges.
- Average losses were nearly twice the size of average wins, so a run of trend days can erase weeks of gains.
Who it suits
Intraday option sellers with full margin who prefer managing a straddle by its combined value, can automate re-entries and accept that most of the edge depends on calm days.
Questions traders ask
What is a combined stop loss on a straddle?
Instead of a separate stop on each leg, the strategy adds the current prices of the call and put and compares the total with the credit received. Both legs are closed together when that total rises past a set multiple, here 1.5 times the credit.
Is the combined-SL straddle profitable?
In this NIFTY backtest from 1 Oct 2025 to 30 Sep 2026 it made ₹60,284 before costs and ₹23,961 after ₹20 per order and bid-ask slippage, winning 69% of 365 trades. Statutory charges were excluded. Past results do not guarantee future ones.
Combined stop or per-leg stop: which is better?
They suit different days. In this test the combined version earned on quiet sessions and lost on trend days, while per-leg-stop straddles in the library did the opposite, earning on trend days. Comparing both on the same period shows how the choice of stop changes the market it suits.
Why re-enter after a target?
After a 20% target the straddle has captured part of the day's decay. Selling a fresh ATM straddle re-centres the position on the current price and lets the strategy collect more decay if the market stays calm.