The Complete Options Trading Strategies Guide:From Theory to ₹8 Lakh Monthly Profits

1. Long Put Strategy Bearish)
When to Use: Expecting significant downward price movement
Risk: Limited to premium paid
Reward: Substantial if stock falls significantly
Pros:
Limited risk with unlimited profit potential
Lower capital requirement than short selling
Benefits from volatility increases
Cons:
Time decay works against you
Requires directional accuracy
Volatility crush can reduce profits
Real Example from Case Study:
Nifty 25350 PE bought at ₹480, sold at ₹715 for 235 points profit. This trade captured a
significant market decline while risking only the premium paid.

2. Covered Call Strategy Income Generation)
When to Use: Neutral to slightly bullish outlook on stocks you own
Risk: Opportunity cost if stock rises significantly
Reward: Premium income plus potential stock appreciation
Pros:
Generates income from existing stock holdings
Reduces cost basis of stock position
Profits from time decay
Cons:
Caps upside potential
Stock can be called away
Requires stock ownership
Implementation Tips:
Target 3045 days to expiration
Select strikes 510% above current price
Consider closing at 2550% profit

3. Bull Call Spread Moderately Bullish)
When to Use: Expecting moderate upward price movement
Risk: Limited to net premium paid
Reward: Limited but well-defined
Structure:
Buy lower strike call
Sell higher strike call
Same expiration date
Pros:
Reduces cost compared to long call
Benefits from time decay on short leg
Defined risk and reward
Cons:
Limited profit potential
Requires directional accuracy
Both legs can expire worthless

4. Iron Condor Strategy Neutral Market)
When to Use: Expecting low volatility and sideways movement
Risk: Limited to net premium paid
Reward: Maximum premium collected minus spread width
Structure:
Sell out-of-the-money call and put
Buy further out-of-the-money call and put for protection
Pros:
Profits from time decay
Benefits from volatility decrease
High probability strategy when properly executed
Cons:
Limited profit potential
Complex management requirements
Vulnerable to large price movements
Management Insight:
Most successful iron condor traders close positions at 2550% of maximum profit rather than
holding to expiration.

5. Long Straddle Strategy High Volatility)
When to Use: Expecting large price movement in either direction
Risk: Limited to total premium paid
Reward: Potentially unlimited in either direction
Structure:
Buy at-the-money call and put
Same strike price and expiration
Pros:
Profits from large moves in either direction
Benefits from volatility increases
No directional bias required
Cons:
High premium cost
Requires significant price movement
Vulnerable to volatility crush
Volatility Timing:
Enter straddles when implied volatility is below historical averages, typically 23 weeks before
earnings or major announcements.

6. Cash-Secured Put Strategy Income + Acquisition)
When to Use: Willing to own stock at lower prices while generating income
Risk: Stock ownership if assigned
Reward: Premium income plus potential stock appreciation
Requirements:
Cash equal to 100 shares × strike price
Bullish long-term outlook on underlying stock
Pros:
Generates income while waiting to buy stock
Potentially acquire stock at discount
Benefits from time decay
Cons:
Tied up capital in cash
May miss better opportunities
Stock could continue falling after assignment

7. Protective Put Strategy Portfolio Insurance)
When to Use: Protecting existing stock positions from downside risk
Risk: Premium paid for protection
Reward: Downside protection while maintaining upside potential
Implementation:
Own the underlying stock
Buy put options as insurance
Typically 510% below current stock price
Pros:
Provides portfolio protection
Maintains upside participation
Peace of mind during volatile periods
Cons:
Reduces overall returns by premium cost
Requires ongoing premium payments
May provide false sense of securit