There are more option strategies than option strategists, but at their heart they are all modifications of basically two ideas – buying and/or selling options. The proliferation of options strategies come from the infinite ways that these two concepts can be combined. Some of these combinations can be great ideas but others are just commission generators with the difference usually resting on how you implement them as a trader. (more…)
Profit in Bear or Bull Markets With Calendar Spreads
Calendar spreads are a great modification of the diagonal option spread strategy. The calendar spread is useful when you are more uncertain about the direction of the market and want to increase the effectiveness of the hedge during periods of market volatility.
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Fighting Time Value with Vertical Spreads
Long option buyers face some particular disadvantages when it comes to time value. But there is a solution to managing time value by turning an option trade into a vertical spread.
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