Option Strategies
There are many different option strategies, ranging from simple to complex. TradeWithPros focus is on the simple strategy of buying a call (going long the underlying) or buying a put (going short the underlying) to profit from the underlying movement in the stock in either direction, up or down. Whether we choose “At the Money”, “In the Money” or “Out of the Money” options will be a direct reflection of the risk in any particular trade.
Along with risk, comes reward. “Out of the money” options have a much higher time value risk, but potentially much greater percent returns. “In the money” options have much lower time value risk, but corresponding lower percent returns.