Best Practices

Weekdays 8:00 – 8:20a CT

Inverting a Position

Best Practices

Options involve risk and are not suitable for all investors. Please read Characteristics and Risks of Standardized Options before deciding to invest in options.

When a strangle for example is tested we have mechanical steps we will take to defend the position. First we will roll up the untested side to collect additional credit. If there is little duration left in the cycle we will roll out in time. The final step we will take in the mechanical defense is to take the position and go inverted.

Inversion in the example of a strangle is when untested side is rolled beyond the tested side. By going inverted we collect additional premium and adjust our deltas. If you like to learn more check out today’s show!

Best Practices More installments

See All »

Latest tastytrade Videos As of December 13

Most Shared From the last 30 days