Options Strategies

Beginner Strategies

New to options? Start right here.

Covered Call Own 100 shares and sell a call against them to collect premium as rent. Income Long Call Buy a call to profit if the stock rises, with risk capped at the premium. Bullish Cash-Secured Put Sell a put with cash set aside to get paid while you wait to buy lower. Income Long Put Buy a put to profit if the stock falls, with risk capped at the premium. Bearish Married Put Buy stock and a put together so your downside is insured from day one. Hedging Protective Put Buy a put on stock you own to set a floor under a possible drop. Hedging

Intermediate Strategies

Got the basics? Time to level up.

Bear Call Spread Sell a call spread to collect credit as long as the stock stays down. Bearish Bear Put Spread Buy a put and sell a lower one to cap both the cost and the risk. Bearish Bull Call Spread Buy a call and sell a higher one to cap both the cost and the risk. Bullish Bull Put Spread Sell a put spread to collect credit as long as the stock holds up. Bullish Calendar Spread Sell near-term time and buy longer-term to profit from a stock that stalls. Neutral Call Calendar Sell a near-term call and buy a longer-dated one to lean bullish while selling time. Bullish Collar Sell a call to pay for a protective put, capping both your risk and your upside. Hedging Costless Collar A collar built so the call fully pays for the put, at zero net cost. Hedging Iron Butterfly A tighter iron condor that collects more premium for a narrower range. Neutral Iron Condor Sell a call spread and a put spread to profit from a quiet, range-bound stock. Neutral LEAPS Call A long-dated call that acts like cheaper stock for a patient bullish view. Bullish LEAPS Put A long-dated put that owns downside for years, for a fraction of shorting's capital. Bearish Long Straddle Buy a call and a put at the same strike to profit from a big move either way. Volatility Long Strangle Buy an out-of-the-money call and put for a cheaper bet on a large move. Volatility Poor Man's Covered Call Use a long-dated call instead of 100 shares to run a covered call for less cash. Income Put Calendar Sell a near-term put and buy a longer-dated one for a slow drift down. Bearish Short Put Sell a put to get paid for a bullish view and a price you would buy at. Bullish The Wheel Sell puts until assigned, then sell calls until called away, collecting at every turn. Income

Advanced Strategies

For traders ready to run the table.

Albatross Spread A condor with far-apart wings for a wide, low-cost profit range on a quiet stock. Neutral Bear Put Ladder Add a lower short put to a bear put spread for extra credit. Bearish Bearish Risk Reversal Sell a call to fund a put for a leveraged, low-cost bearish bet. Bearish Big Lizard A short straddle plus a call spread that removes all upside risk. Neutral Broken Wing Butterfly A skewed butterfly that can open for a credit with a directional lean. Neutral Bull Call Ladder Add a short call above a bull call spread for extra credit with a capped top. Bullish Call Diagonal Blend strikes and expirations to lean bullish while collecting time decay. Bullish Call Ratio Backspread Sell one call and buy two higher ones for a low-cost bet on a big rise. Bullish Covered Put Short stock and sell a put for income with a bearish-to-neutral lean. Income Covered Strangle Own stock and sell both a call and a put to double the premium income. Income Diagonal Call Write Sell short-dated calls against a long LEAPS call, month after month. Income Dividend Collar Collect a dividend while a collar caps both your risk and your upside. Income Double Calendar Two calendars at different strikes for a wider profit range on a quiet stock. Neutral Double Diagonal Diagonals on both sides for range-bound income with longer-dated protection. Neutral Earnings Strangle Buy a strangle before earnings to trade the expected move. Volatility Gamma Scalping Trade the stock against a long-option position to harvest big daily swings. Volatility Index Put Hedge Hedge a basket of stocks with broad index puts in one trade. Hedging Jade Lizard A short put plus a short call spread for premium with no upside risk. Neutral LEAPS Call Spread Buy a long-dated call and sell a higher one for cheaper, defined-risk long-term upside. Bullish LEAPS Put Spread Buy a long-dated put and sell a lower one for cheaper, defined-risk long-term downside. Bearish Long Call Butterfly A cheap, defined-risk bet that the stock pins a specific price. Neutral Long Condor A wider, cheaper butterfly with a flat profit zone between two strikes. Neutral Long Guts Buy an in-the-money call and put for a straddle-like bet with less time value. Volatility Long Put Butterfly A put-based butterfly that profits if the stock pins a lower strike. Neutral Monthly Income Condor Sell a monthly iron condor for steady, defined-risk premium. Income Portfolio Put Hedge Use index puts to protect your whole portfolio from a broad downturn. Hedging Protective Put Spread Buy a put spread for cheaper, partial downside protection. Hedging Put Diagonal Blend strikes and expirations to lean bearish while collecting time decay. Bearish Put Ratio Backspread Sell one put and buy two lower ones for a low-cost bet on a big drop. Bearish Put Spread Collar A collar that uses a put spread instead of a single protective put. Hedging Ratio Call Spread Buy one call, sell two higher ones for a near-free bet on flat to modest upside. Neutral Ratio Put Spread Buy one put, sell two lower ones for a near-free bet on flat to modest downside. Neutral Ratio Write Sell more calls than you have stock to cover for a higher-income, higher-risk write. Income Reverse Iron Butterfly A tighter reverse condor that pays more if the stock makes a sharp move. Volatility Reverse Iron Condor Buy both spreads for a defined-risk bet that the stock breaks out of its range. Volatility Risk Reversal Sell a put to fund a call for a leveraged, low-cost bullish position. Bullish Short Call Sell a naked call for premium with a bearish view and undefined risk. Bearish Short Guts Sell an in-the-money call and put for a wide, high-premium range. Neutral Short Straddle Sell a call and put at the same strike for maximum premium if price sits still. Neutral Short Strangle Sell a call and a put to collect premium while the stock stays in a range. Neutral Strap Two calls and one put for a big move biased to the upside. Volatility Strip Two puts and one call for a big move biased to the downside. Volatility Synthetic Long Stock Buy a call and sell a put to mirror owning the shares for less cash. Bullish Synthetic Short Stock Buy a put and sell a call to mirror shorting the shares for less cash. Bearish Tail Risk Hedge Hold cheap far-out-of-the-money puts as insurance against a crash. Hedging VIX Call Hedge Own VIX calls that spike in value when the market drops hard. Hedging VIX Options Trade the market's fear gauge directly to hedge or speculate on volatility. Volatility VIX Spread Use VIX call or put spreads to trade volatility with defined risk. Volatility Volatility Crush Play Sell inflated options before an event and profit when volatility collapses after. Volatility Weekly Put Selling Sell short-dated cash-secured puts each week for faster, smaller premium. Income ZEBRA A zero-extrinsic back ratio that tracks the stock with almost no time decay. Bullish

New to options? The strategies make more sense once you know the basics.

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