Strategies
Strategies
Strategies explains how the common multi-leg positions are put together and what they actually do. Every article shows the legs, a payoff table at expiry, the maximum gain, maximum loss and breakeven, how time decay and volatility change the picture before expiry, and what can go wrong, including assignment. None of it is a recommendation. A strategy is a shape of risk, and the point is to understand the shape before anyone sells it to you as income.
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Covered Calls Explained: How the Position Works, Payoffs, Breakeven, and Risks
How a covered call is built from 100 shares and one short call, with a payoff table, max gain, max loss, breakeven, assignment risk, and what decades of buy-write index data show.
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Cash-Secured Puts Explained: How They Work, Payoffs, Breakeven, and Assignment
How a cash-secured put works: selling a put while holding the cash to buy the shares, with a payoff table, max gain, max loss, breakeven, assignment risk, and what can go wrong.
Read the explainer →Protective Puts Explained: How Buying a Put Limits a Stock's Downside, and What It Costs
How a protective put works: owning shares and buying a put as a floor, with a payoff table, max loss, breakeven, the cost of protection over time, and what can go wrong.
Read the explainer →Vertical Spreads Explained: Bull Call, Bear Put, and Credit Spreads, With Payoff Tables
How vertical spreads are built from two options at different strikes, debit vs credit, with payoff tables, max gain, max loss, breakevens, early assignment, and pin risk.
Read the explainer →Straddles and Strangles Explained: Payoffs, Breakevens, and IV Crush
How long and short straddles and strangles are built, with payoff tables, max gain, max loss, both breakevens, how time decay and IV crush affect them, and what can go wrong.
Read the explainer →Iron Condors Explained: Four Legs, Two Breakevens, and the Real Risk-Reward
How an iron condor is built from a bull put spread and a bear call spread, with a payoff table, max gain, max loss, breakevens, time decay, volatility, assignment risk, and what can go wrong.
Read the explainer →Butterfly Spreads Explained: How the 1-2-1 Structure Works, With Payoff Tables
How long call butterflies and iron butterflies are built, with payoff tables, max gain, max loss, two breakevens, why time decay helps only near the center strike, and what can go wrong.
Read the explainer →Calendar Spreads Explained: Selling Near-Term Time, Buying Longer-Term Time
How a calendar spread is built from two options with the same strike and different expiries, with an estimated payoff table, max loss, breakevens, the role of volatility, and assignment risk.
Read the explainer →Collars Explained: Capping Losses and Gains With a Put and a Call
How a collar combines owned shares, a long put, and a short call, with a payoff table, max gain, max loss, breakeven, what 'zero-cost' really means, assignment risk, and tax notes.
Read the explainer →The Wheel Strategy Explained: How It Works, Why It's Popular, and the Honest Risks
How the wheel cycles between cash-secured puts and covered calls, with worked numbers, payoff tables, max gain, max loss, breakevens, assignment mechanics, and what can go wrong.
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