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Options Trading System

For me the ideal options trading system is one where there is very little time having to do stock research and where I basically use the same underylings every month to consistently generate a steady monthly income. The last thing I want to be doing is spending my nights away from my family scouring over charts and data – reading articles and reports trying to figure out if the writer is laying out the info as it really is – or if he has an agenda and is spinning it in some way.

Options Trading System – Simple Is Best

I want an easy to implement – easy to manage – easy to track options trading system.

Some of the options trading systems that I have found over the years that fit into this criteria are…

Options Trading System – One Of Our Favorites

The Iron Condor Strategy.

This strategy is the placement of two credit spreads on an underlying with the goal of capturing the time premium that should bleed off over the next however many days there are to expiration. This trade doesn’t require an opinion about the market or direction in the stock and works best in range bound markets or calmer underlyings that are exposed to huge price moves. Etfs and Indexes work great for this trade.

To learn more about other options trading systems that we’ve found to more of the ideal approach for investing (at least for us) be sure to join our FREE options trading system newsletter by CLICKING HERE

The option butterfly spread trade is a popular and favorite options trading system tactic among option income fanatics. Not only does this trade give the trader a considerable level of premium at the beginning of the trade which could be turned into a major monthly cash flow, it also provides a highly sturdy position structure which can take and endure a range of trading environments, including really volatile environments like the ones we are witnessing now. In a crazy stock market where several other option strategies do not have a chance, the butterfly spread may be put on and if appropriately maintained, wind up doing exceptionally well.

When you look at a risk graph of the butterfly spread trade, you’ll be able to see that the butterfly payoff is massive – particularly when compared to other option income spread methods such as the iron condor, the credit spread, the diagonal, double diagonal, the calendar, double calendar, etc.

Depending on where exactly the wings are set on this options trading system technique, or in other words how close or far the long options are acquired in relation to the strikes being sold, it is possible to create a butterfly trade where the possible reward is numerous times greater than the risk of loss is that is being taken on.

In the instances where the reward is so many times greater than the risk being taken on, it is because the wings are being acquired incredibly close to where the sold strikes reside, creating a really tall yet particularly narrow ‘profit tent’, which the underlying needs to remain inside of in order to realize that massive payoff. In most cases, the odds of this happening are extremely low.

Even so, if the underlying remains inside the overall space of this tall, narrow profit tent – plus the trader does not plan to stay with the trade all of the way until expiration day – a good earnings can still be extracted from these lower probability butterfly spread trades as the zero day income line on the risk graph soars up pretty rapidly and a first rate return is usually grabbed within a short level of time.

Among the various options trading system strategies and methods for trading options for income, such as the iron condor, the calendar spread, credit spread and debit spreads – the butterfly spread is one of the more robust and potentially profitable.

This site is focused on looking at the various options trading system programs available to traders.