Options Strategies

What Are Options Strategies in Options Trading?

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Option Strategies Introduction

Option Strategies, or Options Based Investment Strategies, are calculated ways of using options singularly or in combination in order to profit from one or more market movements. Option Strategies are a direct alternative to traditional buying and selling of stocks and offers greater profit potential with limited risk. Choosing which option strategy to use starts from your opinion on the underlying stock. Option strategies are merely the means through which you transform your "prediction" of future stock movement into money through the use of options. Be it that you think the stock is going to move upwards forever, upwards to a certain price only, upwards or downwards unexpectedly, within a narrow price range or whatever, there is an options strategy that will allow you to profit from that EXACT prediction in an optimized way. This is the true magic of options trading.

Option Strategies give options traders the versatility to profit from any opinions that they have on an underlying stock and to limit risk even if that opinion moves against them. The creative use of Options Strategies makes stock options the most versatile financial instrument in the world today. See A Full List Of Option Strategies Here.

Sadly, there are still many fake option trading gurus out there teaching these option strategies for thousands of dollars.

Classification of Option Strategies

Broadly, Option Strategies are classified under 5 categories : Bullish Strategies, Bearish Strategies, Volatile Strategies, Neutral Strategies and Arbitrage Strategies.

Choosing Option Strategies

If you are of the opinion that a stock will go up, you will use a bullish option strategy.

if you are of the opinon that the stock will go down, you will use a bearish option strategy.

If you are of the opinion that a stock will go up or down drastically, you will use a volatile option strategy and

if you think the stock will stay stagnant, you will certainly use one of the many neutral option strategies.

if you see a price discrepancy, you will be able to lock in some arbitrage profits with options arbitrage strategies.

Don't Know If This Is The Right Option Strategy For You? Try our Option Strategy Selector!

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