Options Trading Strategies (Weekly/Monthly Expiry Focused)

In today’s fast-paced financial world, options trading has become a vital part of many traders' toolkits—especially those who focus on weekly or monthly expiry contracts. These expiry-based strategies offer flexibility, potential for quick profits, and can be customized based on market outlook, volatility, and risk appetite.

Whether you're a beginner aiming to earn consistent returns or an experienced trader managing large portfolios, understanding expiry-focused strategies will help you become a more efficient and confident trader.

What Are Weekly and Monthly Expiry Options?
Before we dive into strategies, let’s first clarify:

Weekly Expiry Options: These contracts expire every Thursday (or Wednesday if Thursday is a holiday). Weekly options are available for indices like Nifty, Bank Nifty, and many liquid stocks.

Monthly Expiry Options: These expire on the last Thursday of every month. Monthly options are more traditional and have been around since the inception of options trading.

Both types follow the same structure but differ in time to expiry, premium decay, trading psychology, and risk-reward dynamics.

Why Trade Based on Expiry?
Expiry-based strategies offer unique advantages:

Time Decay (Theta): Premiums erode faster closer to expiry—benefiting option sellers.

Predictable Volatility Patterns: Volatility tends to fall post major events (RBI, Fed, earnings), making short strategies viable.

Quick Capital Turnover: Weekly expiry allows 4–5 trading opportunities in a month.

Defined Risk: You can design strategies where loss is capped (e.g., spreads, iron condors).

Popular Weekly & Monthly Expiry Strategies
Let’s break down some of the most effective strategies used by traders during expiries:

1. Covered Call (Best for Monthly Expiry)
What It Is:
A covered call involves buying the underlying stock and selling a call option against it.

Use Case:
Suitable for investors holding stocks expecting sideways to mildly bullish movement.

Monthly expiry works better due to better premium.

Example:
You own 1 lot (50 shares) of TCS at ₹3500. You sell a monthly ₹3600 call for ₹40 premium.
If TCS stays below ₹3600, you keep the full ₹2000 (₹40 x 50) premium.

Risk/Reward:
Risk: Falls in stock price.

Reward: Limited to premium + upside until strike price.

2. Naked Option Selling (Weekly)
What It Is:
Selling a call or put option without holding the underlying. It’s risky but very popular during weekly expiry, especially on Thursdays.

Use Case:
Traders use it on expiry day for quick theta decay.

Needs strong trend or range view.

Example:
On Thursday, Nifty is at 22,000. You sell 22,200 Call and 21,800 Put, each for ₹10.
If Nifty stays in between, both go to zero—you keep ₹20.

Risk/Reward:
Risk: Unlimited.

Reward: Limited to premium received.

Tip: Always monitor positions or hedge to manage losses.

3. Iron Condor (Weekly/Monthly)
What It Is:
An Iron Condor involves selling OTM Call and Put, and simultaneously buying further OTM Call and Put to limit losses.

Use Case:
Best for range-bound markets.

Weekly iron condors are common in Nifty/Bank Nifty due to fast premium decay.

Example (Weekly Iron Condor):
Nifty spot: 22,000

Sell 22,200 CE and 21,800 PE

Buy 22,300 CE and 21,700 PE

Net credit: ₹40
Max profit = ₹40
Max loss = ₹60 (difference in strike – net credit)

Risk/Reward:
Risk: Capped.

Reward: Capped.

Ideal for non-directional markets.

4. Calendar Spread (Weekly vs Monthly)
What It Is:
You sell a near-term option (weekly) and buy a far expiry option (monthly) on the same strike.

Use Case:
Traders expecting low short-term volatility but high long-term movement.

Volatility plays a crucial role.

Example:
Sell 22,000 CE (weekly) at ₹80

Buy 22,000 CE (monthly) at ₹120
Net debit: ₹40

If Nifty remains around 22,000 till weekly expiry, the short option loses premium quickly.

Risk/Reward:
Risk: Limited to net debit.

Reward: Can be significant if timing is right.

5. Straddle (Monthly/Weekly)
What It Is:
A straddle is buying or selling the same strike price Call and Put.

Types:
Long Straddle: Expecting big move (buy both).

Short Straddle: Expecting low movement (sell both).

Example (Short Weekly Straddle):
Nifty at 22,000

Sell 22,000 CE at ₹60

Sell 22,000 PE at ₹60
Total premium = ₹120

If Nifty closes near 22,000, both decay—you pocket the premium.

Risk/Reward:
Short Straddle Risk: Unlimited.

Long Straddle Risk: Limited to premium paid.

Weekly expiries give better opportunities due to quick decay.

6. Strangle (Weekly Special)
What It Is:
Sell OTM Call and OTM Put (Short Strangle) or buy both (Long Strangle).

Use Case:
Short Strangle is very popular on Thursday.

Use when expecting low volatility.

Example (Short Strangle):
Nifty at 22,000
Sell 22,300 CE and 21,700 PE at ₹20 each

If Nifty expires between 21,700–22,300, both go worthless.

Risk/Reward:
Risk: Unlimited.

Reward: Limited to ₹40.

Tip: Add hedges or monitor closely to avoid slippage on big moves.

✅ Conclusion
Weekly and monthly expiry-focused options strategies can be a goldmine when used smartly. Each strategy has its place—some are built for income, others for momentum or volatility plays. The trick lies in matching the right strategy with market context, expiry timeline, and your risk appetite.

For beginners, start small—paper trade or use small lots. For experienced traders, explore advanced hedged strategies like Iron Condor, Calendar Spread, and Butterflies for consistent profits.

In expiry trading, discipline, risk control, and clear bias are your best tools. Don’t treat expiry days as gambling sessions. Treat them as structured opportunities to benefit from predictable market behavior.