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Boosting ROC

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

There is always a tradeoff between return on capital and Probability of Profit. How do we boost ROC without lowering our POP too much? Tom and Tony go over some of the best strategies with a high ROC in today’s segment.

For tastyBite traders, short Naked Puts can eat up a lot of buying power. What might be some alternative strategies which help to maximize our return on capital while still keeping a high POP? One way we can increase ROC and reduce margin requirements is by defining the risk. For a short put this would mean buying an OTM put. Vertical spreads compared to other trades tend to have the highest ROC while still maintaining a high POP.

Small increases in ROC each year may not seem like much, but compounded over the life of a trading account, it can have a major impact on capital. Tune in to hear Tom and Tony discuss which strategies give you the highest bang for your buck!

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