Options Masters - Complex Strategies

Long Condor Call option

Limited risk and a cheap strategy to enter.

can be very profitable if stock shows low volatility after you are in.

View Neutral Low Margin required Debit Strategy.

If BEP reaches before expiry required adjustments.

Greeks

Net Delta Negative

Net Vega Negative

Net Theta Positive

Factors to consider when deciding whether to take a Long Condor Spread - put options:

Which involves buying one call option at a lower strike price, selling two call options at a higher strike price, and buying another call option at an even higher strike price.

Market Outlook: Assess the overall market sentiment and the specific outlook for the underlying asset. Long condor calls are typically taken when you expect the price of the underlying asset to remain within a specific range, known as the "profit zone," with limited upside potential.

Volatility Expectations: Consider the expected volatility of the underlying asset. Long condor calls benefit from lower volatility, as it increases the likelihood of the price staying within the desired range, thereby maximizing potential profit.

Profit Zone and Breakeven Points: Determine the profit zone and breakeven points for the condor spread. The profit zone is the range of prices within which the strategy is profitable, while the breakeven points are the prices at which the strategy neither makes a profit nor incurs a loss.

Risk-Reward Ratio: Evaluate the risk-reward ratio of the condor spread. Consider factors such as the potential maximum loss, maximum profit, and the ratio between them. Ensure that the potential reward justifies the associated risks and aligns with your risk tolerance.

Time Decay: Assess the impact of time decay, also known as theta decay, on the value of the options. Long condor calls are affected by time decay, and it's essential to consider how the passage of time will affect the profitability of the strategy.

Long Condor Spread Put

Limited risk and a cheap strategy to enter.

can be very profitable if stock shows low volatility after you are in.

View Neutral Low Margin required Debit Strategy.

If BEP reaches before expiry required adjustments.

Greeks

Net Delta Negative

Net Vega Negative

Net Theta Positive

Factors to consider when deciding whether to take a Long condor spread Put:

Which involves buying one put option at a lower strike price, selling two put options at a higher strike price, and buying another put option at an even higher strike price.

Market Outlook: Assess the overall market sentiment and the specific outlook for the underlying asset. Long condor puts are typically taken when you expect the price of the underlying asset to remain within a specific range, known as the "profit zone," with limited downside potential.

Volatility Expectations: Consider the expected volatility of the underlying asset. Long condor puts benefit from lower volatility, as it increases the likelihood of the price staying within the desired range, thereby maximizing potential profit.

Time Decay: Assess the impact of time decay, also known as theta decay, on the value of the options. Long condor puts are affected by time decay, and it's essential to consider how the passage of time will affect the profitability of the strategy.

Iron Condor

Capped risk and reward.

Net Credit of your account. Low Margin strategy.

View Neutral if underlying moves one side required adjustments to keep delta neutral.

Greeks

Net Delta Neutral

Net Vega Negative

Net Theta Positive

Factors to consider when deciding whether to take a Iron Condor:

Which involves selling an out-of-the-money (OTM) call option and an OTM put option while simultaneously buying a further OTM call option and put option.

Market Outlook: Assess the overall market sentiment and the specific outlook for the underlying asset. Iron condors are typically taken when you expect the price of the underlying asset to remain within a specific range, with limited volatility.

Volatility Expectations: Consider the expected volatility of the underlying asset. Iron condors benefit from moderate volatility, as it increases the likelihood of the price staying within the desired range, thereby maximizing potential profit. High volatility can increase the risk of the underlying asset moving beyond the range of the iron condor.

Strike Price Selection: Choose appropriate strike prices for the call and put options based on your price target for the underlying asset and your risk tolerance. The width of the spread between the sold and bought options determines the maximum potential loss and profit of the iron condor.

Premium Income: Evaluate the potential income generated from selling the call and put options. Iron condors provide a way to generate upfront premium income, which can enhance overall returns if the options expire worthless.

Risk Management: Assess the potential downside risk of the trade and ensure that it aligns with your risk management strategy. The risk of iron condors is limited to the width of the spread minus the premium received, but losses can still occur if the price of the underlying asset moves significantly beyond the range of the iron condor.

Time Decay: Consider the impact of time decay, also known as theta decay, on the value of the options. Iron condors profit from the erosion of the options' time value over time, especially if the price of the underlying asset remains within the desired range.

Short Strangle

Net credit into your account

Profitable if stock shows low volatility and does not move.

Uncapped risk on either side.

View Neutral Capital Required Little above Future margin Credit Strategy.

Greeks

Net Delta Neutral*

Net Vega Negative

Net Theta Positive

Factors to consider when deciding whether to take a Short Strangle:

Which involves selling an out-of-the-money (OTM) call option and an OTM put option simultaneously.

Market Outlook: Assess the overall market sentiment and the specific outlook for the underlying asset. Short strangles are typically taken when you expect the price of the underlying asset to remain within a specific range, with limited volatility.

Volatility Expectations: Consider the expected volatility of the underlying asset. Short strangles benefit from lower volatility, as it increases the likelihood of the price staying within the desired range, thereby maximizing potential profit.

Strike Price Selection: Choose appropriate strike prices for the call and put options based on your price target for the underlying asset and your risk tolerance. Selling OTM options allows you to collect higher premiums but also increases the risk of the options being exercised.

Premium Income: Evaluate the potential income generated from selling the call and put options. Short strangles provide a way to generate upfront premium income, which can enhance overall returns if the options expire worthless.

Risk Management: Assess the potential downside risk of the trade and ensure that it aligns with your risk management strategy. The risk of short strangles is theoretically unlimited if the price of the underlying asset moves significantly beyond the strike prices of the options sold.

Time Decay: Consider the impact of time decay, also known as theta decay, on the value of the options. Short strangles profit from the erosion of the options' time value over time, especially if the price of the underlying asset remains within the desired range.

* To keep Delta neutral adjustments required

Iron Fly - Iron Butterfly

Capped risk and reward, good to enter in high vix.

Net Credit of your account. Low Margin strategy.

View Neutral if underlying moves one side required adjustments to keep delta neutral.

Greeks

Net Delta Neutral

Net Vega Negative

Net Theta Positive

Factors to consider when deciding whether to take a Iron Fly - Iron Butterfly:

which involves selling an at-the-money (ATM) call option and an ATM put option while simultaneously buying an out-of-the-money (OTM) call option and an OTM put option.

Market Outlook: Assess the overall market sentiment and the specific outlook for the underlying asset. Iron flies are typically taken when you expect the price of the underlying asset to remain within a specific range around the strike price of the options sold.

Volatility Expectations: Consider the expected volatility of the underlying asset. Iron flies benefit from moderate volatility, as it increases the likelihood of the price staying within the desired range, thereby maximizing potential profit. High volatility can increase the risk of the underlying asset moving significantly beyond the strike price of the options.

Strike Price Selection: Choose appropriate strike prices for the call and put options based on your price target for the underlying asset and your risk tolerance. Selling ATM options allows you to collect higher premiums but also increases the risk of the options being exercised.

Premium Income: Evaluate the potential income generated from selling the call and put options. Iron flies provide a way to generate upfront premium income, which can enhance overall returns if the options expire worthless.

Risk Management: Assess the potential downside risk of the trade and ensure that it aligns with your risk management strategy. The risk of iron flies is limited to the width of the spread between the options sold and bought, but losses can still occur if the price of the underlying asset moves significantly beyond the range of the iron fly.

Time Decay: Consider the impact of time decay, also known as theta decay, on the value of the options. Iron flies profit from the erosion of the options' time value over time, especially if the price of the underlying asset remains within the desired range.

Short Straddle

Net credit into your account

Profitable if underlying shows low volatility and does not move.

Uncapped risk on either side.

View Neutral Capital Required Little above Future margin Credit Strategy.

Greeks

Net Delta Neutral

Net Vega Positive

Net Theta Negative

Factors to consider when deciding whether to take a Short Straddle:

Which involves selling both a call option and a put option with the same strike price and expiration date.

Market Outlook: Assess the overall market sentiment and the specific outlook for the underlying asset. Short straddles are typically taken when you expect the price of the underlying asset to remain relatively stable within a certain range, with limited volatility.

Volatility Expectations: Consider the expected volatility of the underlying asset. Short straddles benefit from lower volatility, as it increases the likelihood of the price staying within the desired range, thereby maximizing potential profit.

High volatility can increase the risk of the underlying asset moving significantly beyond the strike price of the options.

Strike Price Selection: Choose an appropriate strike price for the call and put options based on your price target for the underlying asset and your risk tolerance. Selling at-the-money (ATM) options allows you to collect higher premiums but also increases the risk of the options being exercised.

Premium Income: Evaluate the potential income generated from selling the call and put options. Short straddles provide a way to generate upfront premium income, which can enhance overall returns if the options expire worthless.

Risk Management: Assess the potential downside risk of the trade and ensure that it aligns with your risk management strategy. The risk of short straddles is theoretically unlimited if the price of the underlying asset moves significantly beyond the strike price of the options.

Time Decay: Consider the impact of time decay, also known as theta decay, on the value of the options. Short straddles profit from the erosion of the options' time value over time, especially if the price of the underlying asset remains relatively stable.

Options Masters - Complex Strategies

Long Condor Call option

Greeks Net Delta Negative Net Vega Negative Net Theta Positive

Greeks

Net Delta Negative

Net Vega Negative

Net Theta Positive