what's happening my life game financial fans today we're going to be talking about a strategy for
those of you that like doing call buying and you have a stop that is going to move either
up or down there's no in between on this one so situations where you might have earnings or you
know some news is coming out about a stop maybe apple is going to be doing an event and you want
to plan on the stock going up or down i'm going to show you a two leg strategy that they call the
straddle and i've actually got one of those going on right now on a couple of stops so let's jump
into it if you find me for the first time please subscribe to this channel be sure to turn on
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the strategy ladies and gentlemen is an option strategy that allows you to pick a range for
a stock to be in meaning that you think the stock is going to have a significant move up
or a significant move down and as i mentioned you use that when you have some kind of event
coming like earnings or a company is going to be saying that they're going to launch a new product
anything like that so my examples that i have in my portfolio was bank of america delta airlines
they both had earnings this week and usually newbies in this game you always think that okay
if a company's saying they're going to have great earnings that could boost the stock up because
the very foundation of what makes stocks go up is profits and good earnings but sometimes i've
learned way too many times that just because you've got profits and you have good earnings
sometimes that don't make people jump on the stock sometimes it makes a stop go down for a little bit
but then it eventually comes back up so if you use this strategy you'll cover it both ways so let's
just take an example let's use uh let's see here let's go with tesla yeah let's go at tesla since
you guys know that's one of my pet stocks and let's just say i want to do a straddle on tesla
because they've got earnings coming october 21st and right now the share price of this stock is
8 15 and i think that it's going to either go up or down so what you're doing here is you click on
you click on the price you're going to be buying a call first you can do this in either
order because it's going to all equivalent to the same thing and you just click on that
and then you would next click to buy a put on same stop all right and you're gonna probably
want to do that one down here you know just below the the share price so you've got one higher than
the share and below the share so you click on that and you see right here on robinhood they show you
the change so this is exactly what you're looking for you're looking for that little dip right there
so if the stock goes 860 you're gonna make money and if it drops the seven seven sixty eight you
would make money and if it stays flat is how you would lose money all right now tesla is a very a
very extreme example so let me pick something that might be more in the ballpark of where people want
to go at so let's pick riot blockchain which i'm a long-term holder of riot i believe in what they're
doing using blockchain technology and crypto mining i think that's one that you guys might
consider buying and if you don't have enough money to buy a hundred shares be sure to use the leap
option that i talked about in my last video but if riot has some program or some application going on
like maybe they're going to be doing they're going to be announcing their earnings or they're going
to be announcing partnership deals and you know what's coming just pick the date right after it
so if you know what's coming next week which would be october 22nd pick that expiration date current
price right now is 25 so you're gonna first buy a call above it and then you are going to
buy a put below it and your total price ladies and gentlemen would be 254 dollars because
this helps you out a little better than you having to have all that money up front if you were
selling a put and so you see with this one if riot drops to 22 dollars or below if it falls they're
completely the hell off the planet you're going to make unlimited money and if it has a good whatever
the event was and goes up to 28 dollars and right now it's at 25 so that wouldn't be too hard
you make unlimited money beyond 28 dollars so look at that so 28 you're in the gold
and you go all the way up but you see right here you would lose money if by expiration
it doesn't do anything if it just stays sideways you would lose money so ladies and gentlemen
that's why i say this is a great strategy to use if you know there's going to be something that's
going to be a catalyst to make the stock go up or down so let me comments if you've used this
this type of option strategy before it's a two leg option you know we have options that can go
up to eight legs you've got the iron core door and all kinds of options that people can use
i like to keep things basic and for those you wondering about my favorite option strategy i like
using the wheel options starting by selling puts and if i um get caught having to have the shares
then i'll just take those shares and sell calls on them but for those of you that want to do
something with some stocks that you like and you want to make some money because you hear there's
an event coming this is a great strategy to use that's going to do it for this video
don't forget to like the video please comment subscribe get yourself that life game follow
me on ig hit me up if you ever have questions comments and concerns and i do do one-on-ones
with people for an hour where we go video chat and we try to help you guys do some learning
that link is in the video description as well and until that next sexy as hell video i'll see you