Best Way To Trade Nifty BTST & STBT?

Lets say you’re able to predict around 120 points movement in Nifty spot a day in advance, like BTST (Buy Today Sell Tomorrow) or STBT (Sell Today Buy Tomorrow).

Since you have access to Futures and Options, the best combination depends mainly on how much risk, margin, and volatility you are ready to handle.

Here’s a clean breakdown for you:

1. Futures Strategy (High Risk, High Reward)

• Buy Nifty Futures if you expect upward movement (BTST).
• Sell Nifty Futures if you expect downward movement (STBT).

🔵 Pros:

• Direct exposure. Every point move = ₹50 (lets say Nifty Futures lot size is 50).
• So 120 points = ₹6,000 profit per lot.

🔴 Cons:

• Higher margin requirement (about ₹1.3-1.5 lakh per lot).
• Mark-to-market risk: if the market swings against you, losses are immediate.

2. Options Strategy (Low to Medium Risk, Flexible Reward)

a) Buying Options (Call or Put)

• Buy ATM or slightly ITM Call Option if bullish.
• Buy ATM or slightly ITM Put Option if bearish.

🔵 Pros:

• Limited risk (maximum loss = premium paid).
• Lower capital required compared to futures.
• Big moves (like 120 points) can give 2x–5x returns on premium.

🔴 Cons:

• Time decay (theta loss) if market stalls.
• Options are sensitive to volatility (Vega).

✅ Example:

• Nifty 22500 spot
• Buy 22500 CE (if bullish) for, say, ₹80 premium.
• If Nifty moves 120 points, CE might become ₹200–₹250.
• Your return: 2.5x–3x on your premium.

b) Spread Strategy (Safer Option Buying)

If you want controlled risk and controlled reward, do a Bull Call Spread (for bullish view) or Bear Put Spread (for bearish view).

• Bull Call Spread: Buy lower strike Call, Sell higher strike Call.
• Bear Put Spread: Buy higher strike Put, Sell lower strike Put.

🔵 Pros:

• Reduced cost.
• Time decay impact is lower compared to naked option buying.
• Risk and reward are predefined.

🔴 Cons:

• Maximum profit is capped.
• If the move is huge, you won’t capture the full movement.

✅ Example:

• Buy 22500 CE, Sell 22700 CE
• If Nifty goes 120 points up, you get maximum profit easily.

Summary:

👉 Best Recommendation:

• If you are highly confident AND have margin → Nifty Futures.
• If you want low risk → Buy ATM Option (or slightly ITM).
• If you want even safer with low margin → Do a Bull Call Spread (or Bear Put Spread).