Protective Collar

Definition Protective Collar is an option strategy that involves both the underlying stock and two option contracts. The trader buys (or already owns) a stock, then buys an out-the-money put option and sells an out-the-money call option.  It is similar to the covered call strategy with the purchase of an additional put option. It is being used if […]

 


Iron Condor

Definition Iron Condor is an option strategy which involves four option contracts.All options have the same expiration date. The order of strike for four contracts is A > B > C > D.  Position Strike long 1 OTM put  A short 1 OTM put  B short 1 OTM call  C long 1 OTM call  D […]

 


Iron Butterfly

Definition Iron Butterfly is an option strategy which involves four option contracts. All options have the same expiration date. The order of strike for four contracts is A > B > C.  Position Strike Buy 1 OTM put  A Sell 1 ATM put  B Sell 1 ATM call  B Buy 1 OTM call  C Similar […]

 


Butterfly Spread

 Definition Butterfly Spread strategy involves four option contracts with the same expiration but three different strike prices. There are four kinds of Butterfly Spread:  Name  Strategy  Long butterfly spread with calls  Buy 1 ITM call, sell 2 ATM call, buy 1 OTM call  Long butterfly spread with puts  Buy 1 ITM put, sell 2 ATM put, […]

 


Fundamental Factor Long/Short Strategy

Introduction In this tutorial we implemented a long/short equity strategy based on fundamental factors. The idea comes from AQR white book: A New Core Equity Paradigm[1]A New Core Equity ParadigmOnline Copy. The original version is a long only strategy. We developed it into a long/short version. The paper strategy used some fundamental data as measures […]

 


Long Strangle

Definition Long Strangle is an options trading strategy that involves the simultaneous buying of an out-of-the-money put and an out-of-the-money call of the same underlying stock and expiration date. Similar to Long Straddle, Long Strangle has unlimited profit and limited risk and can be applied if traders think some major news events may cause the […]

 


Long Straddle

Definition Long Straddle is an option strategy involved with the long position of a call option and a put option. Both of them have the same strike price and the same expiration date. This strategy aims to gain profit when you feel that a stock was about to make a big move, but are not sure […]

 


Bull Call Spread

Definition Bull Call Spread is an option strategy involved with two call option contracts with the same expiration but different strikes. The strategy buys the call options with a lower strike and sells the same amount of call options with a higher strike price. This strategy creates a ceiling and floor for the profit. By purchasing […]

 


Covered Call

Definition A Covered Call is an options strategy that involves both underlying stock and an options contract. The trader buys (or already owns) a stock, then sells call options for the same amount of stock. The aim of the Covered Call is to gain profits from option premium by selling calls written on the stock you already owned. At […]

 


The Momentum Strategy Based on the Low Frequency Component of Forex Market

Abstract Trend estimation is a family of methods to detect and predict tendencies and trends in price series just using the history information. Moving average is a commonly used trend following trading tool. Lots of momentum trading strategies in the Forex market are based on the moving average rule, in which signals are triggered if […]

 


Previous