Are all option strategies based off of just a few?

Discussion in 'Options' started by youngtrader, Jul 9, 2008.

  1. Im sure its a dumb question but I have been searching around for a while now trying to find every single option spread out there that people trade and I have come to the conclusion that in reality there is only just a handful of actual option strategies and a million different variations of those strategies.........does this seem correct?

    I mean it seems like you have the following base strategies: call and put spreads (verticals), butterflies, straddles, strangles, ratio spreads, back spreads, calenders and everything else is just a derivative of those base strategies.

    Thoughts? Or am I wrong?
  2. mihalich


    you have just calls and puts
  3. You can either buy or sell a call or buy or sell a put. Between those 4 separate possible actions and the myriad combinations of those actions in different numbers. ratios, months and strikes you get unlimited strategies so to speak. Just like only 8 notes of music but unlimited music.

  4. sorry not sure what you mean
  5. optioncoach

    Very good answer, however what if we are talking about options in just 1 month? Then isn't basically every strategy based on the above base strategies?

  6. cdowis


    Sounds like the training materials on would be of interest to you. It is all free and will give you a good foundation on how various option strategies work.
  7. You are all wrong… :) There is only two variable: future price and volty…the rest is secondary. In simple sport betting terms , if one can establish a 55/45 record , he will be a winner in both straight and parley bets
  8. Actually there really is no difference between calls and puts you're either long options or short options and the associated risks.

    Quote from Roy Neff...

    "a call is a put and a put is a call"
  9. Absolutely ALL strategies are combinations of:

    Long call
    Short call
    Long put
    Short put
    Long stock (or future)
    Short stock (or future)
  10. only one valid strategy: to WIN :D
    #10     Jul 10, 2008