What Is The Wheel Option Strategy?
Asked 3 years ago
I've heard that it can be more profitable than other trading strategies. There's been talk of the wheel options strategy tripling your income and possibly being 'free money.' Although, I know there's hardly any such thing as 'free.' Is this trading strategy as profitable as they say?
Avik Das
Saturday, September 04, 2021
The Wheel Option strategy is a great option that has low risk (making it a safe options trading strategy) and can result in good profit. You sell a put on stock and if the option expires then you grab the initial premium as a profit. It is a strategy of long term basis, and you can only make profits when the price goes upward.
Andia Rispah Igobwa
Monday, September 06, 2021
The Wheel Option Strategy is a leveraged trading strategy that typically involves buying puts and calls at the same strike price, using options spreads, and applying some minor adjustments to buy or sell the underlying security.
It behaves similarly to a long position in a stock, with high profits on an upswing and high losses on downswings depending on how far away from the strike price trades have been placed.
Traders can close their positions easily at any point without financial trepidation should anything go wrong by just managing the call-put ratio.
Please follow our Community Guidelines
Related Posts
Andrew Moran
What are ETFs and How Do They Work?
Filip Dimkovski
How to Determine When to Buy and Sell Dogecoin
Andrew Moran
What Does VWAP Mean?
Andrew Moran
How to Trade Using the VWAP
Andrew Moran
How to Calculate the VWAP
Andrew Moran
What Is the VWAP Indicator?
Can't find what you're looking for?