Risk Management

See how this VIX hedging strategy performed during the Pandemic Crash and learn how portfolio hedging can protect against black swan events.

Learn the basic principles of hedging, the need for portfolio protection, and how to hedge your portfolio.

What is the difference between return of investment and return on investment? When most traders get started they come into the market with one thing on their mind: make money fast! Risk management and protecting your portfolio becomes an afterthought to making money and earning a high rate of return.

If you have a vertical option spread that you need to exit but you don't want to get creamed closing the position, here are some helpful tips so you can safely look for the exit doors without watching your profits evaporate.

Do you know when you should buy back the short leg of a credit spread? It's important to remember that options trading is about controlling your risk and removing trades that show too much risk without enough profit potential. If you can do this consistently, you'll be well on your way to better returns.

Naked option selling is misunderstood and often gets a bad reputation from the investment community. While there are risks involved with trading naked options, here is an opportunity to educate yourself about selling options.

It's fairly easy to blow up your trading account. Too often, traders (both advanced and beginner) allocate way too much to a single trade. Here is a simple formula to determine how many options contracts you should trade.

When should you hold a position and when should you cut losses? Learn to control your emotions and exit trades before they become big losers that blow up your account.

Here is a quick and easy hedging strategy to help you adjust a credit spread that is showing a loss.

Option liquidity is one of the most important factors to weigh when looking for new trading opportunities. Here is a detailed list of why option liquidity is vital to your trading.