What is options trading and how Sensibull works?
As a trader, you hold a view of the market as per your analysis, so does every other trader. However, having a fair view of the market is not enough, you also need strategies for trading and its timely and its appropriate execution.
Enter, Sensibull. Sensibull is an options strategy platform by Zerodha. You can get suggestions on your strategies, based on your market view. It also gives you all the information like expiry, ROI, risk level, capital required, etc. Sensibull was started with the intention of making options trading easier and doable for new traders. It is India’s first options trading platform and provides simple, easy tools for new users, as well as some complex, powerful tools for experienced users.
What is options trading?
Before we actually understand options trading, it is important we understand what are ‘options’. So options can be understood as contracts, that allows you, as an investor to buy or sell securities, index, or any other instrument; at an agreed price, on a predetermined date.
A ‘call’ option is where you buy shares and a “put” option is where you sell shares. Till the expiration date of the stock, an investor has the right to exercise an option. Simply put, options trading is betting on stocks to go up or down in the market.
How Sensibull works?
Once you have logged in, you have to enter your market view in the dashboard. Sensibull suggests option strategies for NIFTY AND BANKNIFTY. You can select the index you want to trade in. You have to enter your market view by entering these details:
View– you have to select between 5 different options, namely Not Above, Above, Between, Below, Not Below.
Target– enter the price you think NIFTY will reach by the expiry.
Target date- you can either enter the expiry date of the contract, or you can enter a specific date in which you think the target price you mentioned above will be achieved.
Once you hit the ‘go’ button, you will have a list of events related to your trade, that can affect it, and how important that event is for your trade.
Once you have considered all the events and their impacts on your trade, it is time you now move on to the strategies. You will see a list of strategies and for each strategy, you will get some additional information, like ROI, risk level, expected profit, etc. you also have filters to select your strategy in a better way.
Sensibull also allows you to compare strategies for different options. If you wish to place an options order, just enter ‘order type’ and ‘lot size’ and then click the trade button.
Sensibull offers three different versions, each with different and more advanced features. The three versions are Basic, Sensibull Lite and Sensibull Pro.
Basic– the basic version is free for all to access and includes features like basic option chain and events calendar.
Sensibull Lite– Sensibull charges its customers INR 800/month for its Lite version. It offers features like basket orders, enhanced option chain, buy sell date, compare options, along with 6 other features.
Sensibull Pro– the pro version is available for INR 1300/month. It offers features like custom strategy builder, analyse your trade and positions tracking of up to 30 solid option positions at a time, along with all of the Lite features.
Pros of Zerodha Sensibull
- Complex strategy can now be executed simply with just a click. You can see all the strategies according to your market view and also all the events that will affect the trade.
- Options like vents calendar, options analysis, etc make it a better platform to trade
- The user interface is simple and can be used by everyone.
All these reasons bring out the best in Sensibull’s trading platform.
Cons of Zerodha Sensibull
- The pricing factor makes it difficult and inaccessible for the small traders.
- There is no option to filter out strategies based on risk and ROI.