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What are option strategies?

Option strategies are implemented by investment professionals to profit from the price movement of an underlying strategy, and can also be used as a hedge against losses or to preserve profits.

Various option strategies have been developed over the years to take advantage of the behavior of the underlying assets. Some of these are designed to be conservative, and others are intended to be aggressive. Sometimes these strategies are known by epic-sounding names such as Iron Butterfly and Iron Condor.

The articles in this sub-topic will provide you with some understanding of the most commonly used option strategies, such as various types of straddles and spreads. Strategies can be considered neutral, bearish, or bullish, and can profit from volatility and price moves or from a lack of movement.

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