Posts by ivtrades

This is when you own shares in a particular stock and then you sell Calls against it and then buy Puts. You would use this strategy when you think that…

This is an order that you would place to offset an existing long position. For example, If you buy a call option to open a new position, you would then…

A closing purchase is an order that you place to offset an existing short position. For example, If you sell a call option to open a new position, you would…

There are some options settle for cash rather than shares. Indexes like the S&P 500 Index (.SPX) and the S&P 100 Index (.OEX) are examples of cash settled options.

This is when you sell Put options with the intention or to take delivery of the underlying shares. Cash is deposited in the account and, if the stock price falls…

A Calendar spread is when you sell an option and buy another one with a more distant expiration date. This can be created with either puts or calls. For example,…

This is basically a combination of Bull Spread and Bear Spread. The main feature of this strategy us that your risk is fixed and your upside/profit is capped. Selling options…

The point at which a strategy produces no profit and no loss.

A Box Spread is simply a combination of two vertical spreads. These spreads are used by professional Options traders who are trying to take advantage of a situation where the…

This is a large equity trade consisting of 100,000 or more shares.