Exchange-traded funds (“ETFs”) provide investors with a great way to invest in a wide variety of assets and reach even the most obscure corners of the market. Stock options can help improve upon these strategies by better controlling risks to reward profiles, making them an invaluable tool for any ETF investor. In this article, we’ll take a look at the covered straddle strategy and how it can be used to generate a profit from an existing long position or to enter into a new one [see also ETF Call And Put Options Explained]. The covered straddle strategy is very similar to the covered call strategy, which many investors employ to generate income from an existing long position. While the covered call simply involves writing one call option for every 100 shares owned, the covered straddle involves writing one call option and one put option for every 100 shares owned. The [...] Click here to read the original article on ETFdb.com. Related Posts: Daily ETF Roundup: Dow Closes Above 15,000, VOX Rallies Alongside Telecom Stocks Daily ETF Roundup: XLF Rises After Berkshire Earnings, EWM Soars On Malaysian Elections How To Rescue Your Losing ETF Position With Options Daily ETF Roundup: IAK Jumps On AIG Earnings, DBB Pops On Copper Rally Friday’s ETF Chart To Watch: SPY Running On Empty Ahead Of Jobs Report
Exchange-traded funds (“ETFs”) provide investors with a great way to invest in a wide variety of assets and reach even the most obscure corners of the market. Stock options can help improve upon these strategies by better controlling risks to reward profiles, making them an invaluable tool for any ETF investor. In this article, we’ll take a look at the covered straddle strategy and how it can be used to generate a profit from an existing long position or to enter into a new one [see also ETF Call And Put Options Explained]. The covered straddle strategy is very similar to the covered call strategy, which many investors employ to generate income from an existing long position. While the covered call simply involves writing one call option for every 100 shares owned, the covered straddle involves writing one call option and one put option for every 100 shares owned. The [...]
Click here to read the original article on ETFdb.com.
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