Top 5 Option Trading Strategies for Employed Individuals
1. Cash-Secured Puts (Buy Stocks on Your Terms)
Best for: Building a portfolio gradually
Sell puts on stocks you want to own at your desired price.
Earn premium income whether you get assigned or not.
If assigned, you buy at a discount.
Why It Works: Time-efficient, conservative, and aligned with long-term investing.
2. Covered Calls (Earn More from Stocks You Own)
Best for: Generating income from existing holdings
Sell a call option on stocks you already own.
Keep the premium if the stock doesn’t hit the strike.
If assigned, sell at a profit plus the premium.
Why It Works: Low-maintenance and profitable in sideways markets.
3. Buying LEAPS (Long-Term Options with Conviction)
Best for: Long-term believers in a stock
Buy call/put options with 1-3 year expiry.
Less time decay and more room for your thesis to play out.
Why It Works: Cheaper than buying shares, and ideal for those who can't monitor markets daily.
4. Iron Condors & Spreads (Sideways Profit Machines)
Best for: Earning income in low-volatility conditions
Use defined-risk strategies like credit spreads.
Collect premium while keeping downside risk in check.
Why It Works: Minimal monitoring, defined losses, and works well when markets move less.
5. Protective Puts (Insure Your Portfolio)
Best for: Hedging during earnings or volatility
Buy puts to protect against major drops.
You only lose the premium if the market stays up.
Why It Works: Peace of mind and risk control without selling your core holdings.
