Options Trading Strategies
Explore our comprehensive collection of options trading strategies, organized by market outlook.
Income Strategies
These strategies are designed to generate consistent income through premium collection and strategic position management.
The Wheel Strategy
A cyclical strategy combining cash-secured puts and covered calls for consistent income.
Poor Man's Covered Call
Using a deep ITM LEAPS call instead of stock to run a covered call with less capital.
Bullish Strategies
These strategies are designed to profit when you expect the underlying stock price to increase.
Long Call
Right to buy stock at a strike price with unlimited upside potential.
Cash-Secured Put
Obligation to buy stock at a strike price if the put buyer exercises.
Covered Call
Owning stock and selling a call option to generate income.
Bull Call Spread
Buying a lower strike call and selling a higher strike call.
Bull Put Spread
Selling a higher strike put and buying a lower strike put.
Fig Leaf
Buy ITM LEAPS call, sell OTM short-term call for leveraged covered call.
Call Back Spread
Sell one lower strike call, buy two higher strike calls.
Inverse Skip Strike Butterfly
Buy one call (strike A), sell three calls (strike B), buy two calls (strike D).
Call Ratio Backspread
Buy one call at strike A, sell two calls at strike B.
Christmas Tree Butterfly
Buy one call (D), sell three calls (B), buy two calls (A).
Bearish Strategies
These strategies are designed to profit when you expect the underlying stock price to decrease.
Long Put
Right to sell stock at a strike price with limited risk.
Protective Put
Owning stock and buying a put option as insurance.
Bear Call Spread
Selling a lower strike call and buying a higher strike call.
Bear Put Spread
Buying a higher strike put and selling a lower strike put.
Put Back Spread
Sell one higher strike put, buy two lower strike puts.
Put Ratio Backspread
Buy one put at strike B, sell two puts at strike A.
Neutral Strategies
These strategies are designed to profit when you expect the underlying stock price to remain relatively stable.
Collar
Owning stock, buying an OTM put, and selling an OTM call.
Short Straddle
Selling a call and a put at the same strike price.
Short Strangle
Selling an OTM call and an OTM put with different strikes.
Iron Butterfly
Buy OTM put, sell ITM put, sell ITM call, buy OTM call.
Volatility Strategies
These strategies are designed to profit from significant price movement in either direction.
Long Straddle
Buying a call and a put at the same strike price.
Long Strangle
Buying an OTM call and an OTM put with different strikes.
Long Butterfly Spread
Buy put A, sell two puts B, buy put C (equidistant strikes).
Double Diagonal
Buy OTM back-month put, sell OTM front-month put, sell OTM front-month call, buy OTM back-month call.