Traders who have been trading for a while may be looking to take their investing strategy up a notch. Advanced options trading strategies are designed to provide higher potential returns than other investment styles. Spreads, straddles, and strangles are three popular advanced options trades that can help traders manage risk more efficiently while generating profits from the right market conditions.
In this article, we will discuss the basics behind these complex strategies to give you an understanding of how each one works and when they might be used in your portfolio.
What are Spreads, Straddles, and Strangles, and how do they work in Options Trading
In Options Trading, three commonly used strategies are Spreads, Straddles, and Strangles. Traders use these strategies to hedge against market volatility and manage risk. A Spread involves buying and selling options with different strike prices and expiration dates to limit potential losses. A straddle involves …
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