Stock Option Trading Strategies That Work

The best way to learn about options strategies is not by reading articles about them. It is by trying different things and visually seeing how a certain strategy behaves for changes in different market factors.

That’s why TradeOptionsWithMe developed The Strategy Lab – a research tool that allows you to visually learn about endless options strategies, options pricing and the options market in general. 

To learn more about The Strategy Lab, go here!



I recently created a free options strategy selection handbook to help options traders with their strategy selection. To gain free access and to learn more about this handy guide, click here!


Select A Strategy Below To Learn More About It.


Iron Condors

  • Range Bound/Neutral/Price Indifferent
  • Defined Risk and Defined Profit
  • Long/Short Strategy
  • Suitable For High Probability Trading
  • (I Prefer The Short Iron Condor Over The Long Iron Condor)

short iron condorlong iron condor


Credit Spreads

  • Slightly Directional To Range Bound/Neutral
  • Defined Risk and Defined Profit
  • Overall Short Strategy
  • Suitable For High Probability Trading
bear credit spread
bull credit spread

Debit Spreads

  • Directional
  • Defined Risk and Defined Profit
  • Not Suitable For High Probability Trading
  • Overall Long Strategy

bull debit spreadbear debit spread


Calendar Spreads

  • Very Directional (To Neutral)
  • Defined Risk and Defined Profit
  • Not Suitable For High Probability Trading

calendar spread


Strangles

  • Range Bound/Neutral/Price Indifferent
  • Defined Risk and Undefined Profit/Undefined Risk and Defined Profit
  • Long/Short Strategy
  • Suitable For High Probability Trading
  • (I Prefer The Short Strangle Over The Long Strangle)

short strangle

long strangle


Straddles

  • Range Bound/Neutral/Price Indifferent
  • Defined Risk and Undefined Profit/Undefined Risk and Defined Profit
  • Long/Short Strategy
  • Suitable For High Probability Trading
  • (I Prefer The Short Straddle Over The Long Straddle)

short straddlelong straddle


Butterflies

  • Range Bound/Neutral/Price Indifferent
  • Defined Risk and Defined Profit
  • Long/Short Strategy
  • Somewhat Suitable For High Probability Trading
  • (I Prefer The Short Butterfly Over The Long Butterfly)

Option Butterfly Strategy longshort butterfly option


Covered Options (Covered Call/Covered Put)

  •  Slightly Directional To Range Bound/Neutral
  • Undefined Risk and Defined Profit
  • Long/Short Strategy
  • Suitable For High Probability Trading

covered call payoff diagram
covered put payoff diagram


Broken Wing Butterflies

  • Range Bound/Neutral/Price
  • Defined Risk and Defined Profit
  • Overall Short Strategy
  • Suitable For High Probability Trading

put broken wing butterfly

call broken wing butterfly


Synthetic Stocks

  • Directional
  • Undefined Risk and Undefined Profit
  • Long/Short Strategy
  • Not Suitable For High Probability Trading

synthetic long stock

synthetic short stock


 

Tell me which strategy you want to learn more about next in the comment section below.

6 Replies to “Stock Option Trading Strategies That Work”

    1. Thanks for the recommendations. I already have articles/videos covering the requested strategies. You simply have to click on the name or the payoff profile of the strategy to get to the more in depth article.

  1. Hi I would like to learn about Selling OTM credit spreads and letting them expire worthless and collect the premium

  2. Hi,

    I am a fresher and I am finding it difficult to understand the meaning of the diagrams you have shown above again still each option trading strategy. Is there any simpler explanation available somewhere or any YouTube video which I can refer to to understand the meaning of each diagram above?

    Regards
    Rahul

    1. Hi Rahul,
      The diagrams are payoff profiles of different option strategies. So they show how the profit and loss of different option strategies is affected by price movement in the underlying asset. If you want a more in depth explanation of these diagrams, simply click on the one you want to learn more about. That should bring you to an article that goes over the strategy in more detail.
      Furthermore, I recommend checking out my free options trading course. In it, you will learn how to use these diagrams and much more.
      Hopefully, this helps.

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