ADANIENT
Adani Enterprises LimitedMax Pain - ADANIENT
Strike 1880 has a total call value of 0 versus a total put value of 294,404,025,015 Combined total value = 294,404,025,015
Strike 1900 has a total call value of 0 versus a total put value of 278,671,599,015 Combined total value = 278,671,599,015
Strike 1900.2 has a total call value of 0 versus a total put value of 278,514,274,755 Combined total value = 278,514,274,755
Strike 1920 has a total call value of 0 versus a total put value of 263,271,391,275 Combined total value = 263,271,391,275
Strike 1938.95 has a total call value of 0 versus a total put value of 248,692,828,440 Combined total value = 248,692,828,440
Strike 1940 has a total call value of 0 versus a total put value of 247,893,643,200 Combined total value = 247,893,643,200
Strike 1960 has a total call value of 0 versus a total put value of 232,701,967,200 Combined total value = 232,701,967,200
Strike 1977.75 has a total call value of 0 versus a total put value of 219,293,398,875 Combined total value = 219,293,398,875
Strike 1980 has a total call value of 0 versus a total put value of 217,609,294,800 Combined total value = 217,609,294,800
Strike 2000 has a total call value of 0 versus a total put value of 202,639,480,800 Combined total value = 202,639,480,800
Strike 2016.55 has a total call value of 6,648,135 versus a total put value of 190,896,317,415 Combined total value = 190,902,965,550
Strike 2020 has a total call value of 8,034,000 versus a total put value of 188,463,804,525 Combined total value = 188,471,838,525
Strike 2035.9 has a total call value of 14,421,030 versus a total put value of 177,273,236,655 Combined total value = 177,287,657,685
Strike 2040 has a total call value of 16,068,000 versus a total put value of 174,403,961,535 Combined total value = 174,420,029,535
Strike 2055.3 has a total call value of 22,214,010 versus a total put value of 163,696,666,575 Combined total value = 163,718,880,585
Strike 2060 has a total call value of 24,102,000 versus a total put value of 160,454,406,825 Combined total value = 160,478,508,825
Strike 2074.7 has a total call value of 30,006,990 versus a total put value of 150,350,514,705 Combined total value = 150,380,521,695
Strike 2080 has a total call value of 32,136,000 versus a total put value of 146,724,974,445 Combined total value = 146,757,110,445
Strike 2094.1 has a total call value of 37,799,970 versus a total put value of 137,197,305,525 Combined total value = 137,235,105,495
Strike 2100 has a total call value of 40,170,000 versus a total put value of 133,210,550,445 Combined total value = 133,250,720,445
Strike 2113.5 has a total call value of 88,559,400 versus a total put value of 124,497,955,545 Combined total value = 124,586,514,945
Strike 2120 has a total call value of 111,858,000 versus a total put value of 120,339,958,845 Combined total value = 120,451,816,845
Strike 2132.85 has a total call value of 157,917,540 versus a total put value of 112,356,569,955 Combined total value = 112,514,487,495
Strike 2140 has a total call value of 193,929,945 versus a total put value of 108,036,406,965 Combined total value = 108,230,336,910
Strike 2152.25 has a total call value of 275,312,820 versus a total put value of 100,720,275,765 Combined total value = 100,995,588,585
Strike 2160 has a total call value of 326,799,945 versus a total put value of 96,185,098,215 Combined total value = 96,511,898,160
Strike 2171.65 has a total call value of 432,995,520 versus a total put value of 89,488,657,245 Combined total value = 89,921,652,765
Strike 2180 has a total call value of 509,109,945 versus a total put value of 84,708,413,340 Combined total value = 85,217,523,285
Strike 2191.05 has a total call value of 681,198,225 versus a total put value of 78,520,747,050 Combined total value = 79,201,945,275
Strike 2200 has a total call value of 820,581,945 versus a total put value of 73,595,579,055 Combined total value = 74,416,161,000
Strike 2210.45 has a total call value of 1,455,736,080 versus a total put value of 68,598,947,085 Combined total value = 70,054,683,165
Strike 2220 has a total call value of 2,036,187,945 versus a total put value of 64,111,142,325 Combined total value = 66,147,330,270
Strike 2229.8 has a total call value of 2,743,272,645 versus a total put value of 59,639,096,565 Combined total value = 62,382,369,210
Strike 2240 has a total call value of 3,545,405,745 versus a total put value of 55,221,218,505 Combined total value = 58,766,624,250
Strike 2249.2 has a total call value of 4,507,124,985 versus a total put value of 51,424,659,105 Combined total value = 55,931,784,090
Strike 2260 has a total call value of 5,688,160,065 versus a total put value of 46,967,828,505 Combined total value = 52,655,988,570
Strike 2268.6 has a total call value of 7,223,605,785 versus a total put value of 43,663,351,605 Combined total value = 50,886,957,390
Strike 2280 has a total call value of 9,373,800,825 versus a total put value of 39,282,998,505 Combined total value = 48,656,799,330
Strike 2288 has a total call value of 11,090,357,625 versus a total put value of 36,329,452,905 Combined total value = 47,419,810,530
Strike 2300 has a total call value of 13,758,634,425 versus a total put value of 31,899,134,505 Combined total value = 45,657,768,930
Strike 2307.35 has a total call value of 17,096,997,810 versus a total put value of 29,957,528,370 Combined total value = 47,054,526,180
Strike 2320 has a total call value of 23,027,114,145 versus a total put value of 26,704,974,285 Combined total value = 49,732,088,430
Strike 2326.75 has a total call value of 26,385,588,795 versus a total put value of 25,053,894,585 Combined total value = 51,439,483,380
Strike 2340 has a total call value of 33,272,936,145 versus a total put value of 22,168,676,610 Combined total value = 55,441,612,755
Strike 2346.15 has a total call value of 36,724,161,780 versus a total put value of 20,942,570,790 Combined total value = 57,666,732,570
Strike 2360 has a total call value of 44,735,666,580 versus a total put value of 18,303,738,600 Combined total value = 63,039,405,180
Strike 2365.55 has a total call value of 48,191,976,810 versus a total put value of 17,344,910,055 Combined total value = 65,536,886,865
Strike 2380 has a total call value of 57,420,788,655 versus a total put value of 15,079,790,190 Combined total value = 72,500,578,845
Strike 2384.95 has a total call value of 60,713,145,030 versus a total put value of 14,336,734,800 Combined total value = 75,049,879,830
Strike 2400 has a total call value of 70,843,220,265 versus a total put value of 12,077,546,190 Combined total value = 82,920,766,455
Strike 2404.3 has a total call value of 74,427,122,775 versus a total put value of 11,636,417,790 Combined total value = 86,063,540,565
Strike 2420 has a total call value of 87,680,874,375 versus a total put value of 10,025,786,190 Combined total value = 97,706,660,565
Strike 2423.7 has a total call value of 90,867,251,475 versus a total put value of 9,653,527,710 Combined total value = 100,520,779,185
Strike 2440 has a total call value of 105,467,637,435 versus a total put value of 8,468,392,200 Combined total value = 113,936,029,635
Strike 2443.1 has a total call value of 108,335,590,035 versus a total put value of 8,259,474,210 Combined total value = 116,595,064,245
Strike 2460 has a total call value of 124,065,077,445 versus a total put value of 7,120,534,200 Combined total value = 131,185,611,645
Strike 2462.5 has a total call value of 126,458,977,695 versus a total put value of 6,969,510,450 Combined total value = 133,428,488,145
Strike 2480 has a total call value of 143,373,637,695 versus a total put value of 5,969,122,950 Combined total value = 149,342,760,645
Strike 2481.9 has a total call value of 145,224,411,735 versus a total put value of 5,860,509,450 Combined total value = 151,084,921,185
Strike 2500 has a total call value of 162,971,802,015 versus a total put value of 4,825,822,950 Combined total value = 167,797,624,965
Strike 2501.25 has a total call value of 164,356,160,640 versus a total put value of 4,792,875,825 Combined total value = 169,149,036,465
Strike 2520 has a total call value of 185,268,121,890 versus a total put value of 4,298,668,950 Combined total value = 189,566,790,840
Strike 2520.65 has a total call value of 185,999,075,295 versus a total put value of 4,281,536,445 Combined total value = 190,280,611,740
Strike 2540 has a total call value of 208,076,488,755 versus a total put value of 3,771,514,950 Combined total value = 211,848,003,705
Strike 2540.05 has a total call value of 208,133,831,430 versus a total put value of 3,770,197,065 Combined total value = 211,904,028,495
Strike 2559.45 has a total call value of 230,478,103,470 versus a total put value of 3,258,857,685 Combined total value = 233,736,961,155
Strike 2560 has a total call value of 231,111,575,100 versus a total put value of 3,244,360,950 Combined total value = 234,355,936,050
Strike 2578.85 has a total call value of 253,013,424,030 versus a total put value of 2,747,518,305 Combined total value = 255,760,942,335
Strike 2580 has a total call value of 254,349,611,100 versus a total put value of 2,717,206,950 Combined total value = 257,066,818,050
Strike 2598.2 has a total call value of 275,496,223,860 versus a total put value of 2,237,496,810 Combined total value = 277,733,720,670
Strike 2600 has a total call value of 277,595,990,100 versus a total put value of 2,190,052,950 Combined total value = 279,786,043,050
Strike 2617.6 has a total call value of 298,816,083,060 versus a total put value of 1,853,959,830 Combined total value = 300,670,042,890
Strike 2620 has a total call value of 301,757,416,980 versus a total put value of 1,808,128,950 Combined total value = 303,565,545,930
Strike 2637 has a total call value of 322,591,865,580 versus a total put value of 1,483,493,550 Combined total value = 324,075,359,130
Strike 2640 has a total call value of 326,268,532,980 versus a total put value of 1,426,204,950 Combined total value = 327,694,737,930
Strike 2656.4 has a total call value of 346,450,249,980 versus a total put value of 1,113,027,270 Combined total value = 347,563,277,250
Strike 2660 has a total call value of 350,880,382,980 versus a total put value of 1,044,280,950 Combined total value = 351,924,663,930
Strike 2675.8 has a total call value of 370,323,744,480 versus a total put value of 742,560,990 Combined total value = 371,066,305,470
Strike 2680 has a total call value of 375,492,232,980 versus a total put value of 662,356,950 Combined total value = 376,154,589,930
Strike 2695.15 has a total call value of 394,135,709,355 versus a total put value of 373,049,520 Combined total value = 394,508,758,875
Strike 2700 has a total call value of 400,104,082,980 versus a total put value of 280,432,950 Combined total value = 400,384,515,930
Strike 2714.55 has a total call value of 418,376,522,970 versus a total put value of 2,583,240 Combined total value = 418,379,106,210
Strike 2720 has a total call value of 425,306,725,530 versus a total put value of 1,236,000 Combined total value = 425,307,961,530
Strike 2733.95 has a total call value of 443,045,500,890 versus a total put value of 804,945 Combined total value = 443,046,305,835
Strike 2740 has a total call value of 450,738,661,530 versus a total put value of 618,000 Combined total value = 450,739,279,530
Strike 2753.35 has a total call value of 467,714,478,810 versus a total put value of 205,485 Combined total value = 467,714,684,295
Strike 2760 has a total call value of 476,170,597,530 versus a total put value of 0 Combined total value = 476,170,597,530
Strike 2780 has a total call value of 501,602,533,530 versus a total put value of 0 Combined total value = 501,602,533,530
Strike 2792.1 has a total call value of 516,988,854,810 versus a total put value of 0 Combined total value = 516,988,854,810
Strike 2800 has a total call value of 527,136,263,400 versus a total put value of 0 Combined total value = 527,136,263,400
Max-Pain Table for Stocks
| Max Pain Table (Stocks) | ||
|---|---|---|
| Symbol | Symbol Ltp | Max Pain |
| 360ONE | 1146.7 | 1140 |
| ABB | 5173.5 | 5150 |
| ABCAPITAL | 358.75 | 350 |
| ADANIENSOL | 978.85 | 980 |
| ADANIENT | 2265.4 | 2300 |
| ADANIGREEN | 1017.7 | 1020 |
| ADANIPORTS | 1509.4 | 1500 |
| ALKEM | 5675.5 | 5700 |
| AMBER | 6562.5 | 6600 |
| AMBUJACEM | 533.8 | 550 |
| ANGELONE | 2641.7 | 2650 |
| APLAPOLLO | 1771 | 1760 |
| APOLLOHOSP | 7189.5 | 7350 |
| ASHOKLEY | 160.86 | 157 |
| ASIANPAINT | 2968.5 | 2920 |
| ASTRAL | 1459.5 | 1460 |
| AUBANK | 960.7 | 940 |
| AUROPHARMA | 1217.6 | 1220 |
| AXISBANK | 1282.5 | 1280 |
| BAJAJ-AUTO | 9109 | 9100 |
| BAJAJFINSV | 2096.5 | 2080 |
| BAJFINANCE | 1048 | 1030 |
| BANDHANBNK | 140.08 | 150 |
| BANKBARODA | 292.6 | 292.5 |
| BANKINDIA | 143.11 | 145 |
| BDL | 1512.5 | 1520 |
| BEL | 406.9 | 410 |
| BHARATFORG | 1406 | 1400 |
| BHARTIARTL | 2108.8 | 2100 |
| BHEL | 277.75 | 285 |
| BIOCON | 392.65 | 400 |
| BLUESTARCO | 1734.4 | 1760 |
| BOSCHLTD | 36920 | 36500 |
| BPCL | 360.3 | 362.5 |
| BRITANNIA | 5961 | 5900 |
| BSE | 2815.9 | 2800 |
| CAMS | 775.7 | 780 |
| CANBK | 148.64 | 150 |
| CDSL | 1550.6 | 1600 |
| CGPOWER | 661.35 | 680 |
| CHOLAFIN | 1730.4 | 1700 |
| CIPLA | 1520.8 | 1530 |
| COALINDIA | 379.95 | 380 |
| COFORGE | 1977.9 | 1860 |
| COLPAL | 2164.4 | 2200 |
| CONCOR | 511.05 | 520 |
| CROMPTON | 260.1 | 270 |
| CUMMINSIND | 4468.9 | 4500 |
| CYIENT | 1169.2 | 1160 |
| DABUR | 510.1 | 515 |
| DALBHARAT | 1989 | 2000 |
| DELHIVERY | 404.6 | 420 |
| DIVISLAB | 6473.5 | 6450 |
| DIXON | 13749 | 14500 |
| DLF | 719.75 | 730 |
| DMART | 3952.1 | 4000 |
| DRREDDY | 1275.2 | 1270 |
| EICHERMOT | 7208 | 7100 |
| ETERNAL | 292.4 | 305 |
| EXIDEIND | 380.15 | 380 |
| FEDERALBNK | 259.2 | 255 |
| FORTIS | 888.55 | 910 |
| GAIL | 169.98 | 175 |
| GLENMARK | 1968.2 | 1940 |
| GMRAIRPORT | 103.51 | 102 |
| GODREJCP | 1136 | 1140 |
| GODREJPROP | 2082.4 | 2100 |
| GRASIM | 2747 | 2760 |
| HAL | 4443 | 4500 |
| HAVELLS | 1436.5 | 1440 |
| HCLTECH | 1683 | 1640 |
| HDFCAMC | 2577.5 | 2650 |
| HDFCBANK | 1003.3 | 1000 |
| HDFCLIFE | 768.3 | 770 |
| HEROMOTOCO | 6350.5 | 6200 |
| HFCL | 69.03 | 70 |
| HINDALCO | 823.25 | 800 |
| HINDPETRO | 450.35 | 455 |
| HINDUNILVR | 2338.6 | 2360 |
| HINDZINC | 498.1 | 490 |
| HUDCO | 225.22 | 230 |
| ICICIBANK | 1392.5 | 1380 |
| ICICIGI | 1974.4 | 2000 |
| ICICIPRULI | 626.05 | 620 |
| IDEA | 10.8 | 10 |
| IDFCFIRSTB | 80.87 | 80 |
| IEX | 145.31 | 145 |
| IIFL | 569.35 | 560 |
| INDHOTEL | 730.9 | 740 |
| INDIANB | 808.95 | 830 |
| INDIGO | 5370.5 | 5500 |
| INDUSINDBK | 870.1 | 860 |
| INDUSTOWER | 415.7 | 410 |
| INFY | 1616.2 | 1600 |
| INOXWIND | 130.24 | 137.5 |
| IOC | 163.66 | 164 |
| IRCTC | 675.2 | 690 |
| IREDA | 133.4 | 140 |
| IRFC | 114.6 | 118 |
| ITC | 404.95 | 405 |
| JINDALSTEL | 1006.8 | 1030 |
| JIOFIN | 303.75 | 310 |
| JSWENERGY | 461.95 | 490 |
| JSWSTEEL | 1162.2 | 1150 |
| JUBLFOOD | 593.2 | 600 |
| KALYANKJIL | 492.5 | 490 |
| KAYNES | 4353.5 | 4900 |
| KEI | 4163.5 | 4150 |
| KFINTECH | 1066.4 | 1080 |
| KOTAKBANK | 2154.9 | 2120 |
| KPITTECH | 1267 | 1240 |
| LAURUSLABS | 1026.1 | 1000 |
| LICHSGFIN | 541.8 | 555 |
| LICI | 869.9 | 900 |
| LODHA | 1111.6 | 1160 |
| LT | 4038.2 | 4020 |
| LTF | 309.6 | 305 |
| LTIM | 6292 | 6150 |
| LUPIN | 2098.8 | 2080 |
| M&M | 3717.1 | 3700 |
| MANAPPURAM | 279.7 | 280 |
| MANKIND | 2205.5 | 2250 |
| MARICO | 736.65 | 730 |
| MARUTI | 16282 | 16200 |
| MAXHEALTH | 1097.4 | 1120 |
| MAZDOCK | 2616.3 | 2700 |
| MCX | 10343 | 10100 |
| MFSL | 1690.2 | 1700 |
| MOTHERSON | 117.05 | 115 |
| MPHASIS | 2953.6 | 2900 |
| MUTHOOTFIN | 3800.1 | 3700 |
| NATIONALUM | 273.15 | 265 |
| NAUKRI | 1388.7 | 1380 |
| NBCC | 112.06 | 115 |
| NCC | 168.16 | 172.5 |
| NESTLEIND | 1246.9 | 1260 |
| NHPC | 77.07 | 78 |
| NMDC | 76.46 | 76 |
| NTPC | 323.3 | 325 |
| NUVAMA | 7172.5 | 7200 |
| NYKAA | 254.8 | 260 |
| OBEROIRLTY | 1657.7 | 1660 |
| OFSS | 8219 | 8200 |
| OIL | 411.95 | 415 |
| ONGC | 241.23 | 244 |
| PAGEIND | 37455 | 38000 |
| PATANJALI | 550.8 | 550 |
| PAYTM | 1344.6 | 1320 |
| PERSISTENT | 6520.5 | 6400 |
| PETRONET | 274.8 | 280 |
| PFC | 352.65 | 365 |
| PGEL | 553.9 | 570 |
| PHOENIXLTD | 1725.1 | 1740 |
| PIDILITIND | 1475.1 | 1480 |
| PIIND | 3396.1 | 3450 |
| PNB | 121.71 | 123 |
| PNBHOUSING | 903.85 | 900 |
| POLICYBZR | 1893.8 | 1860 |
| POLYCAB | 7257 | 7400 |
| POWERGRID | 269.8 | 275 |
| POWERINDIA | 19305 | 20500 |
| PPLPHARMA | 179.85 | 185 |
| PRESTIGE | 1689.7 | 1680 |
| RBLBANK | 305.8 | 310 |
| RECLTD | 353.3 | 360 |
| RELIANCE | 1540.6 | 1540 |
| RVNL | 310.85 | 315 |
| SAIL | 132.54 | 135 |
| SAMMAANCAP | 148.32 | 155 |
| SBICARD | 885.15 | 880 |
| SBILIFE | 2023.7 | 2020 |
| SBIN | 971.5 | 975 |
| SHREECEM | 26075 | 26500 |
| SHRIRAMFIN | 854.9 | 840 |
| SIEMENS | 3325.9 | 3300 |
| SOLARINDS | 12819 | 13250 |
| SONACOMS | 492.85 | 500 |
| SRF | 2885.4 | 2900 |
| SUNPHARMA | 1805.3 | 1800 |
| SUPREMEIND | 3371.1 | 3450 |
| SUZLON | 51.74 | 55 |
| SYNGENE | 639.8 | 640 |
| TATACONSUM | 1162.9 | 1170 |
| TATAELXSI | 5217.5 | 5300 |
| TATAMOTORS | 0 | 320 |
| TATAPOWER | 384.5 | 390 |
| TATASTEEL | 167.11 | 170 |
| TATATECH | 666.45 | 680 |
| TCS | 3238.2 | 3200 |
| TECHM | 1570.8 | 1520 |
| TIINDIA | 2666.7 | 2850 |
| TITAGARH | 789.05 | 820 |
| TITAN | 3813.3 | 3860 |
| TMPV | 353.6 | 360 |
| TORNTPHARM | 3785.9 | 3750 |
| TORNTPOWER | 1289.9 | 1300 |
| TRENT | 4183.1 | 4300 |
| TVSMOTOR | 3665.4 | 3600 |
| ULTRACEMCO | 11597 | 11700 |
| UNIONBANK | 153.3 | 155 |
| UNITDSPR | 1455.6 | 1450 |
| UNOMINDA | 1272.4 | 1300 |
| UPL | 759.1 | 760 |
| VBL | 479.95 | 470 |
| VEDL | 524.5 | 520 |
| VOLTAS | 1327 | 1360 |
| WIPRO | 259.91 | 255 |
| YESBANK | 22.6 | 23 |
| ZYDUSLIFE | 931.45 | 940 |
Note:
| Stock LTP > Max Pain | Bearish Trend |
| Stock LTP < Max Pain | Bullish Trend |
Frequently Asked Questions
Max Pain, also known as the max pain price, is the strike price at which the maximum number of option contracts (both puts and calls) would expire worthless, causing the largest financial losses for option holders at expiration. This price point represents the level where option writers would experience the least payout obligation.
The max pain theory suggests that as expiration approaches, market makers and option writers may attempt to influence the stock price toward this level to minimize their payout obligations, making it a significant reference point for traders analyzing option expiration dynamics.
Max Pain is calculated by determining the total dollar value of in-the-money options at each strike price. Here's the step-by-step process:
- For each strike price: Calculate the difference between the current stock price and the strike price.
- Multiply by Open Interest: Multiply this difference by the open interest (number of contracts) at that strike for both call and put options.
- Sum the values: Add together the dollar value for put options and call options at each strike price.
- Repeat for all strikes: Perform this calculation for every available strike price in the option chain.
- Identify the maximum: The strike price with the highest combined dollar value is the Max Pain price.
This calculation helps identify the price level where option writers would face the maximum financial loss if the stock closes at that price on expiration day.
Traders can incorporate Max Pain analysis into their trading strategy in several ways:
- Expiration Day Trading: As option expiration approaches, traders can use Max Pain as a potential support or resistance level, as market makers may attempt to push the price toward this level.
- Option Selection: Understanding Max Pain helps traders choose strike prices that are less likely to be manipulated, potentially improving their option trade outcomes.
- Risk Management: If a stock is trading far from Max Pain before expiration, traders can anticipate potential price movement toward this level and adjust their positions accordingly.
- Market Sentiment Indicator: Comparing the current stock price to Max Pain can provide insights into market sentiment and potential price direction near expiration.
- Hedging Strategy: Option writers can use Max Pain to identify strike prices where they might face the least payout risk, helping them structure more efficient hedging strategies.
Max Pain provides insights into potential stock price behavior, especially near option expiration:
- Price Magnet Effect: If the stock price is significantly above or below Max Pain before expiration, there may be a tendency for the price to move toward Max Pain as expiration approaches, as option writers hedge their positions.
- Support/Resistance Level: Max Pain can act as a psychological and technical support or resistance level, especially on expiration day, as it represents the price where maximum option value would be lost.
- Volatility Indicator: A large gap between current price and Max Pain may indicate higher potential volatility or price movement as expiration nears.
- Market Maker Activity: Significant open interest concentration around Max Pain suggests where market makers might have the most incentive to influence price movement through their hedging activities.
Note: Max Pain is a theoretical concept and should be used in conjunction with other technical and fundamental analysis tools, as it does not guarantee price movement.
Max Pain is a dynamic value that changes continuously based on several factors:
- Open Interest Changes: As traders open and close option positions, the open interest at different strike prices changes, which directly affects the Max Pain calculation.
- Stock Price Movement: As the underlying stock price moves, different strike prices become in-the-money or out-of-the-money, altering the dollar value calculations.
- Time Decay: As expiration approaches, the time value of options decreases, but the intrinsic value calculations for Max Pain continue to evolve with price movements.
- New Option Contracts: When new strike prices are added or when significant new positions are opened, Max Pain may shift to reflect the new distribution of open interest.
For accurate Max Pain analysis, traders should monitor it regularly, especially in the days leading up to expiration, as it can shift significantly as market conditions and option positions change.
Max Pain and Spot Price are two distinct concepts that serve different purposes in options trading:
- Spot Price (Current Market Price): This is the current trading price of the underlying stock or index in the market. It represents the real-time value at which the asset can be bought or sold immediately.
- Max Pain Price: This is a calculated theoretical price level based on option open interest data. It represents the strike price where option writers would face minimum payout obligations, not necessarily where the stock is currently trading.
The relationship between these two prices is crucial: when the spot price is far from Max Pain, traders may anticipate potential price movement toward Max Pain as expiration approaches. However, this is not guaranteed, and many other factors influence stock price movement.
No, Max Pain is not always accurate and should not be used as the sole indicator for predicting stock price movement. Here's why:
- Market Forces: Strong fundamental news, earnings reports, or significant market events can override the Max Pain effect and drive prices in unexpected directions.
- Institutional Activity: Large institutional trades, algorithmic trading, and other market participants may have different objectives than minimizing option payouts.
- Limited Influence: While market makers may attempt to influence price toward Max Pain, their ability to do so is limited, especially in highly liquid stocks with strong directional momentum.
- Multiple Expirations: Stocks often have options expiring on different dates (weekly, monthly), which means multiple Max Pain levels may exist simultaneously, reducing the predictive power of any single level.
- Statistical Tool: Max Pain is best viewed as a statistical tool that provides context about option market dynamics rather than a guaranteed price target.
Traders should use Max Pain as one of many tools in their analysis, combining it with technical analysis, fundamental analysis, and market sentiment indicators for more comprehensive decision-making.
Max Pain becomes increasingly relevant as option expiration approaches:
- Last Trading Week: Max Pain analysis is most useful during the final week before expiration, when option writers are actively hedging and the "pinning effect" (price movement toward Max Pain) is most likely to occur.
- Expiration Day: On the day of expiration, Max Pain can serve as a key reference level, as market makers may attempt to keep the stock price near this level to minimize their payout obligations.
- High Open Interest: Max Pain is more reliable when there is significant open interest concentrated around specific strike prices, as this indicates where option writers have the most exposure.
- Low Volatility Periods: During periods of low market volatility, Max Pain may have a stronger influence, as there are fewer competing forces driving price movement.
- Monthly Expirations: Monthly option expirations (typically the third Friday) often show stronger Max Pain effects compared to weekly expirations, due to higher open interest and more significant market maker involvement.
While Max Pain can be calculated at any time, its predictive value and practical application increase significantly as expiration approaches, making it particularly useful for short-term trading strategies focused on expiration week dynamics.































































































































































































































