What is a diagonal option trade? A diagonal is when you purchase calls or puts with different strike prices and expiring at different times. Examples: Purchase a $75.00 call expiring in 6 weeks and sell a $70.00 call expiring in 2 weeks. Purchase a $40.00 put expiring in 2 months and sell a $45.00 put […]
Condors
Iron condors are a favorite of mine. I typically only trade them on indexes such as RUT, SPX and NDX. I prefer SPX because I have found it trades more predictable to me. I seem to run into problems more often with RUT and NDX. That is not to say I do not trade them, […]
Virtual Trading
Most online brokerages offer virtual (paper) trading. I cannot begin to express to you the importance of virtual trading. It gives you an idea about how a new strategy will work and how the position looks on a day to day basis. There are a few things I need to warn you about however. First […]
Money Management
This is probably the most important part of any trading strategy or account. Without proper money management you will find your account busted very quickly. Remember if I am right 60% of the time I have done well. That means I have to manage my account in a way that I can survive being wrong […]
