Bull Spread strategy on Manappuram Finance by HDFC Securities



Buy APRIL 110 Call at Rs 6 & simultaneously sell 120 call at Rs 2.5


Lot Size: 6,000



Cost of the strategy: Rs 3.5 (Rs 21,000 per strategy)


Maximum profit: Rs 39,000 If closes at or above 120 on April expiry.


Breakeven Point: Rs 113.5


Rationale:


— Long build up is seen in the Futures where we have seen 11 per cent (Prov) rise in the Open Interest with price moving up by 8 per cent.


— The stock price has broken out from the downward slopping trendline on the daily line chart adjoining the close of April 9 and 20 April


— NBFC, as a sector, is looking good for the short-term chart


— RSI Oscillators has formed positive divergence while MACD has closed above the central line


Disclaimer: Nandish Shah is a Technical & Derivative Analyst at HDFC securities. Views are personal.





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