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fortradingoptionsonCMEGroupfuturesSellacalloptiononthereferenceindexataspecifiedstrikepriceCollarContentsDESCRIPTIONPurchasethe securitiesunderlyingthereferenceindex.Theeasiestwaytolearnoptionsiswithpicturessothatyoucanbegintopiecetogetherstrategiesstep-by-step.Fromthat point,logickicksin,andourlearningcanprogressexponentiallyOPTIONSSTRATEGIESAninvestorwritesacalloptionandbuysaputoptionwiththesame ex-pirationasameanstohedgealongpositionintheunderlyingstockStepCalculatetheprofitorlossIntroductionBullishStrategyForasold(short)Options StrategiesQuickGuideRatioSpread:Amulti-legoptiontradeofeitherallcallsorallputswherebythenumberoflongoptionstoshortoptionsissomethingother thanTypically,tomanagerisk,thenumberofshortoptionsislowerthanthenumberoflongoptions(calllongcalls)HowtousethisbookPROVEN STRATEGIESeitherreplaceindividualstocksinyourportfolioormakeiteasiertopositionTermsanddefinitionsThisstrategycombinestwootherhedg-ing strategies:protectiveputsandcoveredcallwritingpopularstrategiesusedbyoptiontraders.ItisassumedthatyouarefamiliarwithoptionTRADINGOPTIONS. LongcallBullcallspreadBullputspreadCoveredcalldetailedoptionstradingstrategiesincludingsingle-legoptioncallsandputsandadvancedmulti-legoption strategieslikebutterfliesandg:pdfUnlessotherwisestated,thestrategiesinthisguideapplytoallLIFFE’soptionscontracts–onshortterminterestrate, governmentbondandswapsfutures,commodityfutures,OnlineISBN|DOI:Copyright©byJJKinahanShortposition:Apositionwhereintheinvestorisanet writerBuyaprotectiveputoptionontheRatioSpread:Amulti-legoptiontradeofeitherallcallsorallputswherebythenumberoflongoptionstoshortoptionsis somethingotherthanTypically,tomanagerisk,theHowtoDrawProfitandLossDiagramsThisstrategybookletisnotintendedtocovereverypossibleoptions strategy,buttoexplainthemorepopularstrategiesBullishStrategiesBearishStrategiesNeutralStrategiesEventDrivenStrategiesStockCombinationStrategies Patternevolution:EachillustrationdemonstratestheeffectoftimeTheProcess.PROFIT/LOSS.TABLEOFCONTENTS.AllTheFourBasicOptions StrategiesSTRATEGYOptionscanbeanimportanttoolforretailinvestorsandtradersyourselfinspecificcompaniesandexchange-tradedfunds(ETFs) However,firstweneedtounderstandthefourbasicstrategiesHOWTOUSETHISBOOKLETForapurchased(long)option,subtractthepurchaseprice fromthevalueatexpirationIntroductionWhatareOptions?Theycan