Should You Trade SPY ETF Or SPX Broad Based Index Options?
One of my favorite options trading strategies is collecting premium on the U.S. stock market and one of the most frequently asked questions that I get from my readers is whether I prefer to trade SPY Options or SPX options? Unfortunately, there’s no simple answer to this question and instead of giving you my biased […]
Continue reading
High Probability Covered Call Writing
Selling Covered Calls is a very simple approach to trading options for both beginners as well as professional traders. The risk to the downside is mitigated by the sale of the call option and upside risk is eliminated altogether, because the seller is long the underlying asset. In this tutorial I’m going to show you […]
Continue reading
How To Track Volatility With VIX Index
The VIX is calculated using a rather complex formula to derive expected volatility by averaging the weighted prices of out-of-the-money puts and calls. Fortunately, the calculation is performed by the CBOE exchange, so the trader doesn’t have to perform complex mathematical calculations to derive volatility levels manually. There are two common misconceptions that many beginners options traders have […]
Continue reading
Beginners Guide To Vertical Options Spreads
Vertical options spreads are very powerful trading tools if used correctly. There’s a total of four different vertical spreads and each one has it’s own unique purpose. The four different spreads can be divided into two different categories, debit spreads and credit spreads. It’s very simple to differentiate between the two because of their names. With vertical credit […]
Continue reading