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Options Education

Options strategy diagram showing a LEAPS position as the foundation for generating monthly income
Options Education8 min

How to Use LEAPs in an Options Income Strategy

The primary income-focused use of LEAPS is as the foundation of a Poor Man's Covered Call (PMCC). You buy one deep-in-the-money LEAPS call and then sell…

Bernardo Rocha
Calendar showing a long-dated options expiration date far in the future representing a LEAPS contract
Options Education7 min

What Is a LEAPS Options Contract?

A LEAPS (Long-term Equity AnticiPation Securities) is an options contract with an expiration date of one year or more. Everything about a LEAPS works the same…

Bernardo Rocha
Chart showing declining cost basis over time as covered calls are sold against a stock position
Options Education7 min

How to Use Options to Reduce Your Stock Cost Basis

Every time you sell a covered call or a cash-secured put against a stock you own (or want to own), you collect premium that directly reduces your effective…

Bernardo Rocha
Options chain showing a LEAPS long call and a short-term covered call setup
Options Education8 min

What Is a Poor Man's Covered Call?

A poor man's covered call (PMCC) is a strategy where you buy a long-term call option (a LEAPS) instead of buying 100 shares of stock, then sell a shorter-term…

Bernardo Rocha
Investor reviewing covered call options setup on a stock portfolio screen
Options Education8 min

How to Trade Covered Calls for Income

A covered call is an income strategy where you own 100 shares of a stock and sell a call option above the current price. You collect the premium immediately.…

Bernardo Rocha
Options payoff diagram showing a short call strategy at expiration
Options Education8 min

What Is a Short Call Options Strategy?

A short call is an options strategy where you sell a call option and collect the premium. By selling the call, you take on the obligation to sell 100 shares at…

Bernardo Rocha
Options payoff diagram showing a short put strategy at expiration
Options Education8 min

What Is a Short Put Options Strategy?

A short put is an options strategy where you sell a put option and collect the premium upfront. By selling the put, you take on the obligation to buy 100…

Bernardo Rocha
Options chain with time decay graph showing theta gang trading concepts
Options Education7 min

What Is Options Theta Gang Trading?

Theta gang trading is a style of options trading where you profit from time decay rather than predicting price direction. Instead of buying options and hoping…

Bernardo Rocha
Probability distribution chart with win rate and expected value calculations overlaid on an options trading terminal
Options Education8 min

What Is a Statistical Edge in Options Trading?

A statistical edge in options trading is a repeatable advantage that, when applied consistently over a large number of trades, produces a positive expected…

Bernardo Rocha
Beginner investor reading about options trading basics on a laptop with a notebook nearby
Options Education6 min

What Every Beginner Should Know Before Trading Options

Options are contracts that give the buyer the right — but not the obligation — to buy or sell an underlying asset at a specified price before a specific date.…

Bernardo Rocha
Options strategy selection chart showing different approaches for various market conditions
Options Education5 min

What Is the Best Options Strategy Right Now?

The best options strategy right now depends on current market conditions — specifically volatility level, market direction, and your income goals. There's no…

Bernardo Rocha
IRS tax forms and options trading screen side by side
Options Education7 min

What Is Mark-to-Market for Options Traders?

Mark-to-market (MTM) accounting, as applied to securities traders under IRS Section 475(f), is a tax election that changes how you report trading gains and…

Bernardo Rocha