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Ever heard the term “Hurry up and wait”? Well, you’ll be glad to know there are ways to PROFIT from neutral markets! And, to top it off, you do it by SELLING! Let’s take a look …
Author’s Note: This is not trade or financial advice. All trading and investing, whether real estate, stocks, or crypto, involves the risk of loss, sometimes greater than 100% loss. Do not trade or invest with funds you are not willing to lose. I recommend paper trading to practice these principles. This information is being presented for entertainment purposes. Please do your own research.
Options are tricky. For any of you new to options, they lose value over time and reach $0 at expiration. The cool thing is, you can use time to your advantage by selling protected options.
There are 2 basic ways to trade options — BUY or go “long”, or SELL or go “short.”
Most traders like you and me do not have infinite amounts of money, therefore, we need to protect short positions from infinite loss. Let’s first understand “infinite loss”, so that you will understand the structure of an iron condor.
LONG
When you buy an option, you profit if the value of the option goes up (not necessarily the stock, but the value of the option itself). But, if the value loses…
