As per my understanding. It's a fascinating approach that involves purchasing out-of-the-money (OTM) options just before the expiry day, with the hope of achieving massive gains if the market moves significantly on that day. Let me break it down for you:

Overview of the Strategy:

Hero: The goal is to make substantial profits by buying OTM options that become highly valuable due to an unexpected market move.

Zero: Unfortunately, most of these OTM options end up expiring worthless, which results in losses.

Execution:

Traders buy Call options (CE) if they expect the market to rise significantly or Put options (PE) if they anticipate a sharp decline.

The options selected are typically far away from the current spot price (OTM).

The strategy is implemented just before the expiry day.

Factors to Consider:

Volatility: Hero or Zero thrives on sudden market movements. High volatility increases the chances of massive gains.

Risk Management: Traders must be prepared for most trades resulting in losses. Only a few trades yield substantial profits.

Capital Allocation: It’s crucial not to invest all capital in a single trade. Diversify across multiple expiries.

Historical Data: Analyzing historical data helps understand the strategy’s performance over time.

Strike Selection: Choosing the right strike price is critical. It should be far enough from the spot price to be considered OTM but not too far to be unlikely to move significantly.

Example:

Date: 04–04–2018

Spot: 24,129

Strike: 2% * spot = 24,611 (rounded off to 24,600 CE)

Traders bought the 24,600 CE around Rs. 3.8.

The next day, the price surged by as much as 3,600%, resulting in stellar returns in just one day.

Reality Check Is:

While the occasional massive gains are exciting, most trades end up expiring worthless.

The cumulative returns may still be positive due to those rare profitable trades.

Traders need discipline and risk management to effectively follow this strategy.

Remember, Hero or Zero is like chasing lightning—rarely caught, but electrifying when it happens!😄

How the Hero Zero calls are being placed and what are the underlying factors that determines this?