A strangle is an options strategy where an investor simultaneously buys a call and put that have different strike prices but the same expiration date for the same underlying stock. If an investor expects an underlying stock to have a significant price move in the near future, then a strangle is a good strategy to […]
A credit spread is an option spread strategy where an investor sells options that have higher premiums than options that he buys; therefore, the investor enters the trade with a net credit. This strategy is useful to investors as it allows them to profit from the buying and selling of options. In this article, investors […]
A vertical spread is an option strategy where an investor buys an option while simultaneously selling an option of the same type with the same expiration date but at a different strike price. Vertical spreads are useful to investors because they limit the risk involved in an options trade, but they also limit the profit […]
A cash-secured put is an options trading strategy that involves selling a put option while simultaneously setting aside enough cash to buy the underlying stock. This is an effective strategy when an investor is bullish on a stock but wants to buy the stock at a discounted rate. This article will explain how to effectively […]
The iron condor is an option strategy that involves two calls and two puts, each with the same expiration date, but different strike prices. The iron condor is a useful strategy when an investor wants to profit from a security with low volatility. This article will give investors the basic understanding needed to use this […]
The iron butterfly is an option strategy that involves two calls and two puts with the same expiration date but three different strike prices. The iron butterfly is an option strategy that can provide a small profit with limited risk. This article will explain the basics of this conservative, yet effective strategy. The goal of […]