by Rajat Sharma | Jul 19, 2014 | equity, option strategy, stocks |
When to use: When you are Bullish and anticipate the stock / index to rise. How it works: Long Combo Option Strategy uses two option contracts with the same expiry date but different strike prices. In this strategy, you sell/write 1 out-of-the-money put option; and...
by Rajat Sharma | Jul 19, 2014 | equity, option strategy, stocks |
Buy shares and sell a call option of an equal number of shares. The covered call option strategy is also called “Buy write” strategy. When to use the covered call option strategy: When you are neutral (or moderately bullish) on the short term direction of the...
by Rajat Sharma | Jul 19, 2014 | equity, option strategy, stocks |
In synthetic long call option strategy – buy the underlying shares and a put option (of an equal number of shares). When to use : When you are moderately bullish on the short term direction of the underlying stock and want to earn some fixed income from your...
by Rajat Sharma | Jul 8, 2014 | equity, option strategy, stocks |
When to use: Short straddle option strategy is used when the investor believes that the stock is not very volatile. The idea is to earn an option premium on two option contracts. The investor believes that the stock price will not change much before the expiry date....
by Rajat Sharma | Jul 8, 2014 | equity, option strategy, stocks |
When to use: Long Straddle Option Strategy is useful for investors who believe that the stock will be very volatile (i.e. move a lot in price) but are uncertain about the direction of the move. For example, suppose you believe an important court case that will make or...
