Option strategies work best when they are applied to favorable market conditions. Some option positions work well in bullishly trending markets, others are better suited to slow moving or consolidating markets, and there are those that thrive in bearish conditions. Learning to analyze market conditions and then select an appropriate option strategy will go a long way in helping you become a more effective and profitable trader.
Aggressive marketing and the media can leave us with an inflated notion of what can realistically be achieved in our investment and trading accounts. We all like to hear about the spectacular gains realized on a handful of select trades. What we do not talk about are all of the lesser performing trades - not to mention the losing trades - that tend to moderate the overall performance of our portfolio. While it is fun to imagine achieving returns like those alluded to by those marketers and media pundits, actually chasing them can leave you over leveraged and exposed to catastrophic loss. Establishing realistic profit targets will afford you greater stability within your portfolio and provide you with a foundation from which to achieve long-term capital growth.
If you are new to options we will provide you with a basic understanding of what options are and how they work in the articles and other resources we have made available here. Learn the basic functioning of an option contract, the difference between a call option and a put option, and receive the answer to several questions important to both novice and expert options traders.
Radioactive Trading by Kurt Frankenberg is a married put strategy that employs several position adjustments to lock in profits resulting from favorable market moves. The service tends to over sell the married put option strategy and is primarily a stock picking service that will benefit during bull markets.