Many people are searching for the secret to trading stocks and options profitably. Infomercials abound with a variety of schemes for unlimited wealth with minimal effort. In the options trading world, many firms promote a particular trading strategy as the “holy grail of trading” or the “low risk and high returns” options trading strategy. The [...]
If you decide to create consistent positive cashflow from option trading, you may wish to consider the advantages of options spread trading over simply buying calls or puts and hoping for the market to go in the anticipated direction. Option spreads can be used in a number of ways, from the simple debit or credit [...]
I received an email from one of my students a few days ago. He was frustrated with his trading over the past several months. He wasn’t losing money, but his account wasn’t very far ahead of the game either. He was convinced he must be doing something wrong.
Chris took my Advanced Options Strategies course [...]
Most trading literature on option strategies tend to lean towards mathematical formulas to define the construction of a spread. Guy Cohen has chosen to use pictorial logic, even with the Greeks unique to a particular strategy, to piece together the legs of a spread with diagrams.Diagrams that connect with each other are a much more [...]
A credit spread is a type of vertical spread. It is a trading strategy in which you are buying an option, call or put, at a certain strike price, and simultaneously selling the same type of option at a different strike price of the same month. The sold strike price must have a higher [...]