What Option Strategy Do You Use?

Discussion in 'Options' started by ironchef, Mar 2, 2024.

How Do You Trade Options

Poll closed Mar 16, 2024.
  1. Mainly an option writer

    41.7%
  2. Mainly an option buyer

    25.0%
  3. Mainly non directional combination or spreads

    45.8%
Multiple votes are allowed.
  1. ironchef

    ironchef

    I am an amateur retail, have been trading options continuously since 2013.

    Like all retails, I started out trading covered calls and cash secured puts. Eventually some of us retails evolved and branched out to other methods.

    For me I eventually figured out how to make money trading directional, single legs: Mainly an option buyer now.

    I noticed few on ET employs this approach, most professionals trade combinations and most retails write calls/puts.

    I am curious. Here is a quick poll if you don't mind sharing.
     
    zghorner and EdgeHunter like this.
  2. From observing some who sell option advice, seems they fall into 2 categories.

    1. News and fundamental developments about a company.. any reason to trade on a stock is the same reason to trade on its options. Most like to trade OTM but near.. 1-2 strikes away or further.

    2. TA... looking for a technical chart reason to trade a stock/option. This seems the be the most common.

    Bottom Line.. Learn "Price TA"... when you find a technical reason to trade on a stock, you can trade its options the same way.
     
    ironchef and SimpleMeLike like this.
  3. Good Morning Scataphagos,

    I agree with this. You are correct! K.I.S.S. Keep it simple.
     
  4. ironchef

    ironchef

    If you want KISS, don't touch options, just trade futures. :cool:
     
  5. Most traders don't sell CSP because they can't afford assignment. CSP are the greatest money maker period relative to risk.
     
    EdgeHunter likes this.
  6. Quanto

    Quanto

    I'm mainly doing CSP and CC :).
    Soon will also do Collar (ie. by adding a LongPut to the above mentioned; the Put variant I call "PutCollar" :)).
    I also use some variations/extensions of the above by using different (non-standard) Qtys...
    These are all directional, most are bullish, but bearish is possible too to construct.
    Btw, a CSP order is much easier to do in practice than a CC, as for CC one has to enter more data...
     
    Last edited: Mar 2, 2024
  7. What are the deltas of the short call and long put in your collar?
     
  8. Quanto

    Quanto

    It's not fix, my scanner determines it. Ie. if the overall expectancy meets some criteria...
     
  9. ironchef

    ironchef

    CSP is essentially a bullish strategy and in the current market it should work very well.

    But if you are bullish, why not just buy a call?
     
    Lou Friedman likes this.
  10. ironchef

    ironchef

    No cost collar is a good way to manage your company's stock options when it gets ITM.
     
    #10     Mar 2, 2024