📈 Kotak Mahindra Bank Share Price Plummets After RBI Action
After the Reserve Bank of India’s action on Thursday, there was a significant drop in Kotak Mahindra Bank’s share price. Despite this downturn, the bank’s put options trading made some investors wealthy. Due to repeated violations of IT standards, the RBI has imposed a ban on Kotak Mahindra Bank for adding new online customers and issuing new credit cards.
📉 Trader Makes Profit Despite Share Price Decline
According to a report, a trader bought 18 lots at 3:11 PM yesterday (April 24). The trader mentioned that he could only invest Rs. 1,000 and could earn up to Rs. 20 lakhs in a day. In reality, the cost of short-term contracts has increased by 104% to 71,600%.
💰 Huge Returns on Kotak Bank Options
For example, KOTAKBANK APR 1700 PE has risen from 20 paise to Rs. 60 from yesterday’s closing level. Additionally, Kotak Bank’s annual loss increased from Rs. 1660 to Rs. 17.05, representing a 34,000% increase. Similarly, Kotak Bank closed at Rs. 35.85 with a 5 paise increase from the previous closing of APR 1680 PE, reflecting a 71,600% return. PE is an indicator of a market downturn.
⚖️ Understanding Put Options
This is a contract that gives investors the right to sell a certain amount at a predetermined price within a specified period. When an investor chooses put options, they are already hoping for the stock to fall.
For example, assume Sudhir expects the company’s share price to decline. In this case, Sudhir purchases the company’s shares through a put option at Rs. 50 per share. Sudhir now has the right to sell the stock at Rs. 50 on the expiry date. If the company’s share price drops to Rs. 40, Sudhir can book at Rs. 50 per strike price, resulting in a profit of Rs. 10 per share. If Sudhir had bought 1,000 put options, he would have made a profit of Rs. 10,000.
Disclaimer: This is News Coverage with Opinions of Experts and Should Not Be Taken as Direct Market Buying Tip. Market is always subject to risk. We recommend taking our content as research before investing.
