In the last two articles I explained two vertical call spreads; namely, Bear Call and Bull Call. As the reader will notice, these two are not grouped by direction, for one is bearish in nature while the other is bullish in its outlook. Most option books out there separate the verticals according to direction: Bullish or Bearish. However, that is a mere matter of preference. As long as the option trader understands that a bearish or a bullish vertical position can be built by either calls or puts, that is all that matters. The fine difference that I use in my option trading, which determines whether to use calls or puts, is determined by (I.V) implied volatility. Let me elaborate on this a bit more…

The goal of this article is to walk the readers step-by-step through my thinking process when placing a vertical debit call spread trade.

In my previous article, I introduced the concept of verticals and defined their four main components. Here I am going to deal with a specific vertical spread that also happens to be one of my favorite strategies. It is known under many different names: Short credit call, Bear Call, or vertical call sale.

This article is the first one in a series of five articles on the topic of vertical spreads. It will introduce the concept of the vertical spread and define its four main components. The subsequent articles are going to deal with individual vertical spread strategies, one vertical spread per article.

Next, let us look at the option chain and instead of focusing on the selection of the strike prices, let us see if there is any premium worthwhile selling…

Every once in awhile, students ask me if it is wise to sell verticals on any given product at any time. The answer is much more complex than a simple yes or no reply. In this article, I will explain my thinking when it comes to selling verticals, either Bull Puts or Bear Calls. For a change, I will not focus in this newsletter on the technicals or fundamentals but instead, I will place my entire center of attention on I.V. (implied volatility) of the underlying and three additional option components.

How to incorporate naked chart reading techniques into your options trading…

In many of my classes, as I go through various option strategies, a question frequently pops up about the married put. The majority of our students are unfamiliar with the intricacies of the married put. Here I am going to explain, in a simple and easily understandable way, what a married put is…