I explain what IV crush is, why implied volatility collapses after earnings, and how to avoid it or even profit from it by selling options.
Education
Options trading can be a great way to generate income, reduce risk, or speculate on the future direction of the market. However, it is important to understand the risks involved before you start trading options.
I explain the put/call ratio, how it is calculated, and how to use this sentiment indicator to gauge whether the options market is bullish or bearish.
I break down options market metrics like implied volatility and open interest, plus strategies to profit from short-term stock movements while managing risk.
LEAP options are a smart alternative to buy-and-hold, letting you control a stock for a year or more to capture long-term growth at a lower cost.
I walk through how I build, backtest, and refine options trading strategies using data analysis, because guessing without the numbers rarely holds up long term.
Bearish pressure on a stock can generate profits for short sellers. It can also earn money for option traders. Using a bear call spread, a net premium is earned, and this income will be pocketed if the stock makes just a modest decline.
A credit spread option is an act of taking two or more options and selling the premium they produce. Yes, that sounds confusing. I'll explain, but first, let's explore quickly the concept of writing a contract. In this post, we will explore how traders can make monthly income trading options via spreads.
When you foresee upcoming volatility in a stock, an option play that can make money from it is the short call calendar spread. Because there are two expiration dates in the strategy, it has a considerable amount of complexity and should only be attempted by experienced traders.
The short strangle option strategy is an opportunity to profit when a stock moves sideways. Instead of just selling one call or one put, you sell one of each, which produces twice the income. But the maximum loss with this type of trade is unlimited, while the potential gain is capped at the amount of premiums received.
