Manage episode 522523446 series 3636603
This episode presents a comprehensive, systematic methodology for selecting optimal strike prices for bull put spread options, asserting that correct strike choice is paramount for successful trading. The core of this logic is the use of delta, which represents the probability an option will expire worthless, with the hosts favouring the 0.50–0.60 delta zone for core income trades. This probabilistic framework is reinforced by technical analysis, requiring that the short strike be placed at a distance below meaningful support levels to buffer against market drops. Moreover, the strategy dictates adjusting strike distance based on implied volatility (IV), moving safer (lower delta) when IV is high, but potentially closer to the underlying price when IV is low to capture meaningful premium. These defined risk parameters, along with guidance on appropriate spread width, underpin the host's professional, automated options strategy known as "Monthly Trend."
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41 episodes