The Zero Cost Way to Protect Stock Gains with Options
You've got a stock position that you want to protect from an impending market sell-off or crash.
But buying protection or insurance typically costs money right?
And in nearly all cases you've been told to buy put options that are far OTM. The only problem is that these options tend to expire worthless (which is why we sell them here at Option Alpha), and if you have to purchase them each month the costs can stack up over time.
In today's show, I'll help you think about options strategies a little different then maybe you have before.
Ready to learn the "zero cost" protection strategy? Let's dive in!
In Today's Show, You'll Learn About:
- Why buying an ATM put spread and selling a call above the market to finance the trade for a net credit might be the best protection you'll ever get.
- The benefits and drawbacks to this strategy going forward.
- Why you need to start using options as building blocks for your overall portfolio strategy.
- How to leverage one strategy to pay for and fund another at zero cost.
- The cheapest way to hedge your stock position from a market sell-off.
- A specific case study looking at a TLT position with this custom options strategy to reduce the cost of owning the stock by 1.26% each month.