As a regular reader of this blog, you have already read about some of the clever, and often creative, strategies that options traders come up with to beat the market. One of those techniques is a multi-position approach known as “the straddle.” Along with the related “strangle”, it is a way of securing your position … Continue reading The Long and Short of Straddles in Options Trading
In an earlier post, the concept of the straddles in option trading, a strategy where traders take out call and put contracts on an otherwise identical position, was discussed. Well, the strangle is pretty closely related to a straddle, but it is a little more complicated. Here’s how it works: The Strangle The strangle is … Continue reading What’s a Strangle and How Can You Use It in Options Trading?
What is an S&P 500 Index option? Good question. S&P Index Options, or “SPX options,” are linked to the value of Standard and Poor’s 500. Similar to the Dow Jones Average, the S&P 500 is a weighted measure of stock market value. At any given time, the value of the option matches that of the … Continue reading Five S&P Options Trading Strategies
It doesn't seem to matter how often people are told to take the emotion out of trading. Whether it is stocks or stock options, there still seems to be an overwhelming number of people who let their emotions rule. There is nothing inherently wrong with emotions. They are part of what makes humans, well, human. … Continue reading Trading Psychology 101: Eight Ways to Avoid Emotional Trading
Quick! Figure out what this means: GMCO170701C00010500. It is, in appearance, either a nuclear launch code or the reason why finance bloggers should not start drinking before they sit down to write. It is in fact a stock option ticker symbol, and it is something that any options trader will absolutely need to know. Here's … Continue reading Decoding Stock Option Ticker Symbols