Strategy Guide

• Market View: Bullish (Call) or Bearish (Put)
• Risk: Limited to the premium paid
• Reward: Unlimited (Calls) or grows as price falls (Puts)

• Market View: Neutral to slightly Bearish (Call) or Neutral to slightly Bullish (Put)
• Risk: Theoretically unlimited (Short Call) or grows as price falls (Short Put)
• Reward: Capped at the premium collected

• Structure: Buy Call + Buy Put at the same strike
• Commonly described in educational literature as a structure that may benefit from
• significant volatility when direction is uncertain
• Positioned to benefit if price moves significantly in either direction, net of costs
• Risk: Total premium paid

• Structure: Buy OTM Call + Buy OTM Put
• Commonly described in educational literature as a structure that may benefit from
• significant volatility; lower cost entry than a Straddle
• Trade-off: Cheaper than a Straddle, but requires a larger price move to offset costs
• Risk: Total premium paid

• Structure: Buy lower strike Call + Sell higher strike Call
• Commonly described in educational literature as a structure that may benefit from
• moderate upward price movement
• Max Profit: Capped (Difference between strikes minus net cost)
• Max Risk: Net premium paid

• Structure: Buy higher strike Put + Sell lower strike Put
• Commonly described in educational literature as a structure that may benefit from
• moderate downward price movement
• Max Profit: Capped (Difference between strikes minus net cost)
• Max Risk: Net premium paid

• Long: Commonly described in educational literature as a structure that may benefit
• when price remains near the center strike; maximum profit occurs at center strike
• Short: Structurally exposes the position to outcomes where price moves away from
• the center strike
• Risk: Defined by "wings" (protective options)

• Long: A "pinning" structure that achieves maximum profit when price settles near
• the center strike at expiration; tight risk profile
• Short: Structurally exposes the position to outcomes where price moves beyond
• the outer strikes
• Structure: Uses 4 options of the same type (1:2:1 ratio)