Options Trading

The short put options trading strategy is an excellent way to generate passive income on the stock market. A short put strategy has a high probability of profit, meaning you will win most of your trades. However, even if you win more than 80% of the time, it only takes one bad trade to ruin…

When you place orders for options trades, there are various order types that you must know. Sell to open vs. sell to close orders let your broker know whether you are opening a trade or closing an existing trade. This article will discuss when you should use each order type and why it is essential…

James Cordier’s hedge fund lost $150m from selling options. His investors received an email stating they had lost all their money and owed more to cover a margin call. He then recorded a cringe-worthy apology video where he apologized for ten minutes about how bad he felt. You must learn about the OptionSellers blow up…

SPX and SPY both track the S&P 500 index, but these two financial products have significant differences. The products have different options settlement, contract sizes, and tax treatments. If you are interested in trading the S&P 500, you must understand the differences between the SPX vs. SPY. First, What is an Index A stock index…

Iron condors and iron butterflies share the same four-leg structure: a short call spread paired with a short put spread, all expiring on the same date. The difference is where you place the short strikes, and that one design choice changes the profit zone, the max profit, and the volatility environment each strategy thrives in….

If you want to start trading options, I created the ultimate guide to generating income with options in this post. You can also learn about technical analysis for options trading to improve your trade timing. Options Trading Terminology Before you learn how options work, you must know all the basic options trading terminology. If you…

The poor man’s covered call strategy (PMCC) is a fantastic method if you want to trade options for income with minimal capital requirements. The PMCC strategy is a bullish trade; therefore, you should use this strategy when you believe an underlying stock will increase in price. The poor man’s covered call is one of many…

The wheel strategy, also known as the triple income strategy, is a consistent way to generate income on the stock market. The wheel combines trading options with stocks to outperform the classic buy-and-hold investing strategy. What is the Wheel Strategy The wheel options strategy is a method that combines the cash-secured put and the covered…

A covered call is one of the few options strategies that gets pitched to brand-new traders and run by institutions at the same time, and for good reason: it pays you income on stock you already own. The catch is that the same trade that hands you a premium today can cap your upside tomorrow,…

Knowing your breakeven price before you enter a trade is one of the simplest ways to make sharper decisions. Most options traders know the basic formula for a long call or put, but once you start trading spreads or multi-leg strategies, the math changes and many traders skip this step entirely. Here is how to…