Part 8 Trading Master Class With Experts

Neutral Market Strategies

Sometimes traders expect the market to move sideways with low volatility. Options shine here:

Straddle: Buy a call & put at the same strike.

Profits if stock makes big move (up or down).

Expensive because of double premium.

Strangle: Buy OTM call & OTM put.

Cheaper than straddle.

Needs a strong move in any direction.

Iron Condor: Sell OTM call + sell OTM put + buy far OTM call + buy far OTM put.

Profits if stock stays within a range.

Popular income strategy.

Butterfly Spread: Combine calls or puts at 3 strike prices.

Best when expecting very little movement.

Advanced Strategies

Calendar Spread: Sell near-term option & buy long-term option at same strike.

Benefits from time decay differences.

Ratio Spread: Sell more options than you buy.

High-risk, high-reward.

Diagonal Spread: Mix of calendar & vertical spread.

Box Spread: Combination that locks in risk-free profit (used by arbitrageurs).

📌 Takeaway: Strategies allow traders to play in bullish, bearish, or neutral markets while controlling risk. Mastery of strategies separates professional traders from gamblers.