MarketNeutralOptions.com

What is market-neutral?

It is very difficult to make money by simply buying a call and hope that the underlying rallies or buying a put and pray that the market crashes. You might have heard that more than 90% of the options expire worthless. So what do you think of your chance of holding on to the options that are worth millions?

To be market-neutral is to be non-directional, which simply means, you make money regardless of where the market goes! Whether the market goes up or goes down you make money!

It sounds too good to be true isn’t it? Well, I’ll be honest with you: there’s a catch. There is a range that the market can rally or crash to. As long as the market stays between the profitable range, my trades will make money!

Even if the market breaks beyond the range, I won’t have a catastrophic loss because I have very little risk to enter the trade and whatever risk I have are pre-defined.

The way I make consistent profit is to have a super wide range for the market to move. Usually my trades aim to have a profitable range of 100 points on the S&P 500 index (SPX). As long as the SPX stays within the 100 points range for the next 60-70 days, I’ll make good profit!

How does it work?

While the market is unpredictable and full of uncertainties, there’s one thing that is certain: options lose value over time. Options are decaying assets and lose time value over time. As mentioned earlier, more than 90% of options expire worthless.

My strategies exploit this obvious property of options. It’s a lot easier to make money from options by selling options than by buying options! The options I sell will decay in value over time and when the time comes, I’ll buy back the options I sold at a much lower price and pocket the difference. Read more>>>