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Box Spread – Your Secret Weapon for Risk-Free Options Trading
In this blog post, I will explain everything you need to know about box spreads, which are often considered the closest thing to risk-free options trades. You will learn what a box trade is, why it’s useful, how to construct one, and how to use it for various financial purposes such as generating income, replicating…
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Jade Lizard – A Strategy for a Sold-Off Market with No Upside Risk
Traditionally, neutral strategies such as the strangle or iron condor carry inherent risks on both sides of the market. A substantial move in either direction can be challenging. However, there is a groundbreaking options strategy maintaining a neutral bias while completely eliminating upside risk. It is the Jade Lizard, which allows traders to collect rich…
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Naked Put Nightmare? No Problem! Here’s How to Fix It.
Ever had a put option trade go seriously south, like way deep in the money? It happens, even to the best of us. Picture this: you’ve tried some smart moves, rolled that put option down and in time, but the trade’s still stuck. Feeling the panic vibes? It’s a common struggle among traders. You could…
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ZEBRA – the Best Options Trading Strategy for a New Bull Market?
The ZEBRA (zero extrinsic value back ratio spread) allows you to get close to the same directional exposure as owning 100 shares of stock, but with much less risk. It’s my favorite stock replacement strategy. In contrast to other stock replacement strategies such as synthetic long stock, risk reversal, or LEAPs, the ZEBRA provides substantial…
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How to Invest in US-Listed ETFs from Europe: My Ultimate Solution
If you’re an EU resident looking to invest in US-domiciled ETFs, you may be out of luck. Since 2018, EU legislation has made it difficult for EU retail investors to trade US-registered ETFs due to a lack of compliance with the Undertakings for Collective Investment in Transferable Securities (UCITS) directive. This regulation requires that ETFs…
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Trade Idea: Synthetic Long Bonds using TLT Options
Bonds are generally thought to be the boring, relatively safe part of an investment portfolio. They’ve acted as a safety net, providing a sense of security to investors during turbulent times. However, in 2022, the traditional relationship between stocks and bonds was turned on its head. Bonds were no longer a predictable asset but instead…
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Pair Trade Idea: Russell 2000/Nasdaq
Have you ever heard of pairs trading? It’s a clever and fascinating investment strategy used by many hedge funds. It involves buying and selling two assets that are highly correlated, with the aim of profiting from short-term price divergences between them. It’s a fantastic way to hedge against market risk while still making money. And…