In this position trading strategy video, we will begin with a 300 share buy and discuss profit taking to resistance. And then after a resistance pmd high and an initial call short, we will continue with the strategies for beginning and completing ratio option short spreads.
Position strategy reference video series – video1 begins with a stock buy of 100 shares and the timing for selling a call and buying a put, followed by the exit of the stock. Additionally discussed are position profit graphs, and an overview of upcoming videos.
This video discusses a short facebook call that recently went deep in the money and was at a 2.39 loss – and facebook has gone up around 2 more points since then. However, because of our short options protection strategies, this call is actually part of a profitable position.
The trading math for call and put options vertical spreads is first determined by the spread strike width, and whether it is long or short. Since these are covered spreads, the maximum loss will be the strike width minus the debit paid or the credit received.
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