Strategy #1: The Thursday Expiry Strategy
The Thursday weekly expiry trading strategy offers the potential for annual returns of 80-100%, effectively doubling your capital within a year. With a high success rate of over 90% and minimal downside risk, it’s a compelling approach.
To implement this strategy, initiate a short strangle at 9:30 AM, setting strike prices 200-300 points away from the current spot price.
To lower the required margin, purchase deep out-of-the-money (OTM) weekly options. Hold the position until around 11:30 AM, targeting a 60-point move, which typically generates returns of approximately 4%.
For consistent success, always trade with a stop-loss and be ready to adjust for unexpected market movements.
Strategy #2: The Short Straddle Strategy
The short straddle strategy offers significant profit potential when executed with patience and discipline.
To optimize returns and manage risk, it’s best to initiate the strategy at least 30 minutes after the market opens, as early market fluctuations can be unpredictable. Avoid implementing this strategy on high-volatility days, such as expiry days or during major financial events.
Rather than setting a stop loss based on premium percentage—since option premiums can spike during intraday moves—set your stop loss based on key market levels. Keep the stop loss wider, as the market typically remains within a 1% range 30 minutes after opening and 30 minutes before closing.
Close your positions 30 minutes before the market closes to avoid potential price swings that could disrupt your strategy for the following day.
By maintaining a 1% market-based stop loss on both sides, you can capture profits on most trading days using the short straddle strategy.
Strategy #3: Weekly Covered Calls
Looking to boost your portfolio with some extra income? The Weekly Options Covered Call strategy could be your answer. This approach involves selling weekly call options against your existing stock holdings (covered calls), or buying new shares and simultaneously selling call options against them (buy-write).
By selling options that expire weekly, you can generate a consistent stream of income, similar to receiving a weekly dividend. Over time, this strategy has outperformed simple buy-and-hold investments, offering higher returns with about two-thirds of the volatility.
However, if the stock price rises significantly above the strike price of the calls you sold, your potential gains may be capped, resulting in a lower return than if you hadn’t sold the calls—but you’ll still likely see positive returns!
We use a unique tool to screen for potential weekly covered call opportunities and share a sample of our trades each week, so stay tuned for more updates.