 Part three strategies for options. So I've already made part one which was strikes part two which was Months and part three is the last in the series of three and I'm going to cover strategies now These are the easiest to understand There's so many different strategies, but I just want to give you some Three basic strategies in combining the characteristics of these options I'm going to cover a long call. I'm going to cover a short put and I'm also going to cover a vertical spread and Vertical spread will have a short short short leg and a long leg and I'm going to do a short put and You could also do the same thing for a long call spread because they're kind of like a box Let's jump over to the long call We're still going to use our snapchat example. Now. Let's say we think snapchat is a good value Obviously, I can't can't know the future, but I think maybe it goes to 15 Maybe it pulls back and then eventually goes higher I don't know, but I'm going to put on a trade and I'm going to give myself the best chance to succeed So for this case, I'm going to put on the What are we going to do something with a lot of time I'm going to look at the 10 strike and There is a January 17 2025 and there's also a Jan for 2026 for our purposes I'm going to look at that almost when you're out and I'm going to try to put on a Conservative long call now because I'm trying to be conservative I'm going to do for this example the four strike the four strike is deep in the money So this is not a junkie option. This this option will give me the upside and Instead of using $1100 For a hundred shares. I'm gonna only have to pay 730 about $730 because this four strike call Which gives me the upside from four and on it costs me 725 to 735 So we're gonna say it's 730 So it's a little bit of leverage Not quite 50% and probably I don't know what that is. It's a Probably a third leverage because I only have to put up Two two-thirds of the capital, but this is a conservative option It's in the money deep in the money. It gives me all the upside and only some of the risk So that's gonna be an example of using a little bit of leverage for a bullish idea Now We're gonna do a short put now. Let's say I Maybe I bought the long call. Maybe I have shares, but I also want to create some income the way I could do it is I'm gonna look at the puts and There's a sweet spot for option decay. We're gonna use Roughly two months. I'm gonna look at the April Everybody might have a preference. I don't mind 60 days. Some people like 30 days for this example. That's that's roughly two months so we're gonna use the April month April 19th month and then to be conservative. I'm gonna go below 10 I might even do Because 11 about 11 is about 50 deltas, which means it represents 50 shares out of 100 I might do if I look at the 10, that's probably around 20 to 30 deltas For this example, I'm gonna go even further down and I'm gonna look at the nine strike Which means if I sell the nine put for April for two months, someone is gonna pay me 20 cents to buy it at nine. I have to commit to buying the shares at nine I am selling the put I am offering the put I am entering a deal To give someone protection when someone buys a put they want the downside of nine They're buying the nine put and hoping the stock crashes or they're using it as insurance If I'm selling I'm taking the other side if a buyer buys the nine I'm selling the nine. So I'm only gonna get 20 20 bucks. That's all I get but I Get the income for two months and if it never goes down there I just keep the 20 bucks if it does go down there. I have to buy the nine I have to buy the shares 100 shares at nine, but I already got paid 20 bucks So my cost basis the price at which I will own them will be around 880 now the current price is 11 So as of right now, I'm happy to own them at 880 if I'm if I'm bullish the shares on on Snapchat I don't mind owning them now, but I would be even happier to buy them at below nine So you see how that works? I'm getting paid to do something I already want to do and this might be cash secured. This might be a little margin It's up to you, but I'm getting paid to buy something. I already want to do Selling the put is like buying the shares with a coupon So it may be confusing for you. Luckily, you can always rewatch this section and Hopefully, you'll understand the verb itch and you can look up some of the words But this is the way option traders speak So now vertical spreads it was calls and puts Only and then I switched it to vertical spreads now if you look Vertical spreads are when you combine two options now in this example We're gonna do a short put spread real quick because it's kind of an advanced Concept and may not have enough information or not enough time to cover it. I'm gonna do Let's say we're gonna do the same spread as That nine put we were talking about and we're gonna do the nine seven. So what that means is if I go also go to April which is two months and Maybe I don't want to sell the put naked, which means without protection or cash secured I can do a spread which means I sell the nine put and I buy a smaller option below and the combined spread is Is a 14 to 18 so almost the 20 bucks It's a little bit less But now I have less risk because I can always Exercise the seven strike this whole spread is two dollars wide and I'm collecting 15 16 cents, but I only have the $2 whole $2 risk versus $9 Hopefully that makes sense I'm just trading a box a $2 wide box. I'm collecting a little less income for a little less risk This is called a spread If I was bullish, I would do something different. I would buy Maybe an 11 13 Call spread or a 10 12 call spread and again we're trading a box This is a $2 box here 10 12 buying the 10 call and then selling the 12 call a little higher the whole relationship that whole spread is 90 let's say 95 cents and it can go up to $2 I can only lose 95 cents if if my trade is completely wrong and that's why option traders like spreads There are smaller trades and it allows people to trade their thesis their ideas Without as much risk. Okay. Those are the three strategies that I covered. I covered a long call I covered a short put and I did vertical spreads I didn't the Bullish put spread for a credit and I'm also covered the bullish Call spread for a debit. I hope you found that useful Let me know in the comments if you enjoyed these series one two and three You can rewatch the other ones and you can follow for more of these if you like this stuff. Cheers