I would like to hear from more experienced traders on the option writing strategies, ideas and opinions for monthly income.
I already have short position on EUR/USD since May 2014. I have 50K put options strike 1.33 exp. 27 Feb 2015 800% on profit and 40K Short FX spot from 1.26 level. My view on EUR is still bearish 12 month target is below parity. Short term view is consolidation and maybe little upwards correction. I don't know if there is any realistic geopolitical or macro factors that could strengthen the EUR? Also don't know how much Grexit speculation is effecting on and how it will effect if they leave, if EUR either strengthen or weaken? For example Dennis Gartman and some other analysts are saying that Grexit would strengthen the EUR. I believe that Grexit will not happen at least in the short term view.
My question is what could be a good option selling strategy for a monthly income either addition to my existing position or separated new position?
It’s quite overwhelming how many different option strategies there is to choose. Here is some of the strategies I have been considering:
Long put calendar spread - I think this is my favourite simple to understand and limited loss.
Naked calls - Don’t like the unlimited loss risk, simple to understand, although as I have already short position this wouldn’t be naked.
Sell straddle - Could collect more premium but don’t like the unlimited risk
Bear call spread - Like that the loss is limited, not that simple
Bear put spread - Like that the loss is limited, not that simple
To keep it simple I was thinking to just sell naked puts or 1 and 12 month calendar spread. I would like to have little bit upside protection as I think EUR/USD might correct up little bit but eventually go down. Also planing to short more from every correction via buying puts. Maybe ultimate strategy would be put calendar spread and sell otm naked calls as I think upside on euro is limited?
I have before messed up profitable trades by averaging up and over leveraging so I don't want to go too crazy just get little bit monthly income and learn the art of writing options. I usually only do medium to long term directional bets buying either puts or calls, I don't have experience selling options.
All ideas, advice and opinions are much appreciated.
I already have short position on EUR/USD since May 2014. I have 50K put options strike 1.33 exp. 27 Feb 2015 800% on profit and 40K Short FX spot from 1.26 level. My view on EUR is still bearish 12 month target is below parity. Short term view is consolidation and maybe little upwards correction. I don't know if there is any realistic geopolitical or macro factors that could strengthen the EUR? Also don't know how much Grexit speculation is effecting on and how it will effect if they leave, if EUR either strengthen or weaken? For example Dennis Gartman and some other analysts are saying that Grexit would strengthen the EUR. I believe that Grexit will not happen at least in the short term view.
My question is what could be a good option selling strategy for a monthly income either addition to my existing position or separated new position?
It’s quite overwhelming how many different option strategies there is to choose. Here is some of the strategies I have been considering:
Long put calendar spread - I think this is my favourite simple to understand and limited loss.
Naked calls - Don’t like the unlimited loss risk, simple to understand, although as I have already short position this wouldn’t be naked.
Sell straddle - Could collect more premium but don’t like the unlimited risk
Bear call spread - Like that the loss is limited, not that simple
Bear put spread - Like that the loss is limited, not that simple
To keep it simple I was thinking to just sell naked puts or 1 and 12 month calendar spread. I would like to have little bit upside protection as I think EUR/USD might correct up little bit but eventually go down. Also planing to short more from every correction via buying puts. Maybe ultimate strategy would be put calendar spread and sell otm naked calls as I think upside on euro is limited?
I have before messed up profitable trades by averaging up and over leveraging so I don't want to go too crazy just get little bit monthly income and learn the art of writing options. I usually only do medium to long term directional bets buying either puts or calls, I don't have experience selling options.
All ideas, advice and opinions are much appreciated.
