Options Trading
The first—and perhaps biggest—challenge of options trading is understanding what an option is.
An option is a contract giving you the right, but not the obligation, to buy or sell a specific security at a specific price over a specific period of time. After that period of time has elapsed (known as “expiration day”), the option ceases to exist.
A call option gives you the right to buy the security.
A put option gives you the right to sell the security.
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Options Trading Post Archives
Bear call spreads are conservative, high-probability options trades that - if you string enough together - can deliver massive returns. Here’s how they work.
The proposed takeover of Splunk (SPLK) by Cisco (CSCO) was a big win for my subscribers, here’s why we bought options just days before it was announced.
Using Buy-Writes to generate income is a safe way to create yield in this market—it’s as close to free money as you can find.
Two options trading strategies can help any investor create yield that far exceeds traditional avenues: Covered Calls and Writing Puts.
When investing in oil you have many choices from companies to funds, but long-term option investments may be the best play of the group.
Headlines about Michael Burry “buying” $1.6 billion of put options have been everywhere; they’re also incredibly misleading. Here’s why.
Subscribers have been asking me how to protect profits using options ever since the bull market took a breather. Here’s my response.
Volatility is the lowest it’s been for years, which makes it an ideal time to deploy my favorite investing strategy in a low-volatility market.
The market has changed character so fast it’s causing whiplash. This options strategy can help you protect hard-earned profits in the new bull market.
The S&P 500 has posted solid gains so far this year, here’s how to play it by buying (going long) calls or puts on the indexes.
Use these strategies against any of your equity or index holdings when you want to start hedging a portfolio with options.
Tech has started off 2023 hotter than any year in the past 20, and this bear call spread is a play on that rally losing steam.
I can’t say for sure that it’s insider trading (if it quacks like a duck...) but following this unusual option activity is a winning strategy.
Dividend Aristocrats are a group of stocks with strong track records of dividend payments; this options strategy can help you boost their yields.
They say, “Be greedy when others are fearful.” With that in mind, I’ve built an options-based portfolio using only 5 big bank stocks.