We like to explore, educate, and share ideas involving options trading. Come along with us on
our journey to demystify the complex yet rewarding world of options trading.

  1. Put-Credit-Spreads-Make-Me-Sad

    My SPY Put Credit Spread Trades For October 2017 (or lack there of)

    If your an options volatility trader this is how you felt in the month of October. I was unable to open any put credit spread trades in October. Bottomline......volatility was super low! I think the market is just sort of flat waiting for tax reform. 

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  2. Tradier-Logo-Square

    Tradier and the On-Going Options Trading Software Revolution

    Tradier is a powerful brokerage API that allows non-brokers to provide broker services. Let’s talk about why Options Cafe selected Tradier as our first official partner.

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  3. Long-Calendar-Spread-Graph

    The Long Calendar Spread Explained

    Instead of trading stocks or other securities, why not trade time? The long calendar spread allows you to buy and sell option contracts with different expiration dates, with the likelihood of profiting from time decay. The maximum loss of this strategy is capped at the net debit the investment incurs at the entry point.

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  4. Stock Trader To Options Trader

    Jumping From Stock Investing to Options Trading

    Many stock traders are jumping into options trading. Options offer a fantastic way to diversify and to produce extraordinary returns. Let’s look at the key differences between options and stocks, and why so many stock traders are becoming options traders.

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  5. Calendar-Spread-Image

    How to Profit with a Short Calendar Spread

    The short calendar spread is a good opportunity to profit from a stock’s impending upswing or decline. The maximum gain from the investment is the net credit received when entering the trade, and the maximum loss could be substantial. Therefore, this option strategy should only be used by experienced traders.

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  6. Butterfly Options Trading

    Introduction to the Butterfly Spread Options Trading Strategy

    The options butterfly spread is a low-risk options trading strategy that stands a high chance of producing a small profit. The  butterfly options trading strategy uses four options contracts to produce profits off of price stable markets.

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  7. Put-Credit-Spread-Trades-September-2017

    My SPY Put Credit Spread Trades For September 2017

    Once again it is time for our monthly summary of trades I closed. Below are the put credit spread trades I closed in September 2017. My birthday month!! Compared to August a number of put credit spreads closed this month. Volatility continues to be very low. When volatility is low we have less opportunities to place trades. Click to take a look at the trades.

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  8. Premium-Options-Trading

    How Does Volatility Affect Option Prices

    There are six variables that determine an option’s theoretical value.  But, theoretical value is not the same things as market value.  The thing that links theoretical and market value together is one key variable out of the whole mix.  This one key variable is volatility and it has a huge influence on how an option is going to trade.

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  9. Options-Growth-2

    How Successful Options Traders Generate Monthly Income

    Many people think they can quit their day job and start day trading. The truth is, most do not succeed day trading long term. There is an alternative that can generate monthly income just like you hoped to do by day trading. In this post we explore the concept of selling premium in the options market using probability-based options trading.

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  10. Short-Put-Butterfly-Risk-Graph

    Learning The Short Butterfly Strategy

    The short butterfly option trading strategy is a good way to earn small profits, while keeping downside risk to a bare minimum. If you think a stock is set to experience a sizeable move, either up or down, break out your short butterfly playbook.

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  11. How-To-Paper-Trade-Options

    A Quick Guide to Paper Trading Options & Newbie Investing

    Paper trading options is one of the best ways to learn options trading. Learn for example how put credit spreads can boast your returns. When paper trading you can learn first hand about all the different aspects of trading options. Learn how volatility affects premium. Learn to profit from time decay. In this post we are going to explore how to paper trade real options.

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  12. Trading-The-Greeks

    Trading Option Greeks : An Example Trade

    Knowing how the Greeks influence premium is not academic.  Understanding how they are likely to affect your next trade is a critical component of that trade’s set up.   You should always perform an analysis of the Greeks before you send an order to your broker.  Here are some important things to look for.

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  13. Put Credit Spread Trades On SPY For August 2017

    My SPY Put Credit Spread Trades For August 2017

    If your a follower of this blog or a follower of my trades you might have noticed I stopped posting trades. That is all about to change starting with this post. I am once again committed to posting the trades I place monthly. The reason for the absence in trade posting is we have been crazy busy preparing for the launch of our new trading platform -- Just not enough hours in the day :(.

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  14. Long-Call-Butterfly-Risk-Graph

    The Butterfly Spread is a Great Low-Risk Investing Strategy

    If you want a conservative option investment that controls losses, take a look at the butterfly strategy. This derivative tactic comes with finite profitability, but also downside protection. The butterfly play is best for stocks that have low volatility.

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  15. Different Type Of Option Greeks

    How Option Greeks Affect The Premium You Trade

    Most traders realize that options increase or decrease in value as the underlying stock moves up or down in price.  But, there’s a lot more to how an option’s price changes over the course of time before expiration.  A better understanding of option greeks will go a long way to improving the success of your trades.

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