Backspreads, Diagonals and Butterflies - Advanced Strategies
This course combines 3 advanced spreads - Backspreads, Diagonals (and Double diagonals), and Butterfly spreads.
What you will learn
Learn about three advanced strategies - Backspreads, Diagonals and Butterfly spreads
Learn how the Backspread can be constructed in very creative ways
Why the Backspread can be a monthly income strategy and a Volatility strategy at the same time
What are the differences between a Calendar spread and a Diagonal
Why the Diagonal spread is considered an exotic strategy
Learn about the very exciting Butterfly spread
What are the best times to trade a Butterfly spread
What are the specific applications of a Butterfly spread that can make it a very powerful weapon in your arsenal, especially if you have losing trades
Why take this course?
🌟 Backspreads, Diagonals, and Butterflies - Advanced Strategies 🌟
Course Overview
This comprehensive course dives into three advanced options strategies: Backspreads, Diagonals (and Double diagonals), and Butterfly spreads. Each strategy is a powerful tool in the world of options trading, capable of being used to manage risk, profit from time decay, and hedge against market movements. By mastering these techniques, traders can navigate complex financial instruments with confidence and precision.
Section I - Backspreads and Ratio Spreads 📈
Backspreads involve creating an unbalanced position with more long options or more short options relative to the underlying asset. This imbalance allows for a variety of creative strategies depending on your market outlook. We will guide you through constructing an optimal back spread by considering different strike prices and ratios of long to short options.
What You Will Master:
- 🎓 The philosophy behind Back and Ratio Spreads
- 🎨 Creative possibilities with the Back Spread
- 🔬 How to analyze Greeks in a Back Spread context
- 🚀 Understanding and avoiding the "Valley of Death"
- 🌱 Why Back Spreads are a great fit for busy professionals
Key Points:
- Ratio spreads have unlimited loss potential and are not recommended.
- The flexibility of the back spread makes it highly adaptable to different market conditions.
Section II - Diagonals and Double Diagonals 🐝
Diagonals are a sophisticated variation of Calendar time spreads, with their own unique characteristics. They involve selling a higher strike option and buying a lower strike option with a different expiration date. This creates a Delta bias and reduces Vega exposure compared to regular Calendars. We will explore the intricacies of Diagonal spreads and learn how to adjust them effectively, including the powerful Double Diagonal strategy that can expand your profit zones.
What You Will Master:
- 📚 What Diagonals are and how they differ from Calendals
- 🛠️ Normal adjustments for a Diagonal spread
- 🚀 The benefits of better Theta decay in Diagonals
- ⚠️ The increased risk associated with Diagonals compared to Calendars
Section III - Butterfly Spreads 🦋
The Butterfly spread is a low-risk, high-reward strategy that involves three different options contracts. It's a complex option strategy used by experienced traders who understand the nuances of options trading. The Butterfly can be a powerful hedge or a way to profit from specific events like earnings reports. This course will cover how to construct and adjust a Butterfly spread, its applications in protecting other strategies, and when it generates maximum profits.
What You Will Master:
- 🎯 Understanding the low risk, high reward nature of the Butterfly
- 🔮 The probability of successful outcomes with the Butterfly
- ⚙️ How to adjust and manage Butterfly spreads effectively
- ✨ Speculative uses for the Butterfly in trading
- 🛍️ When the Butterfly is not a consistent trade option
By completing this course, you will have a deep understanding of these advanced options strategies. You'll be equipped to apply them skillfully to your trading arsenal, allowing you to navigate complex financial markets with greater confidence and success. Let's take the next step in mastering these powerful trading tools! 🎓🏆
Our review
🏆 Global Course Rating: 4.45/5.0
Overview of Course Reviews
Pros:
- Comprehensive Content: The course provides a good overview of the strategies discussed, with detailed explanations. (Multiple reviews)
- Real-World Application: Instructions are given using real values in Thinkorswim (ToS), which helps in understanding the practical application. (Reviews by several users)
- Credibility: Hari Swaminathan's background from Columbia University adds to his credibility. (Review)
- Clear Explanations: The course explains the strategies, including the Iron Condors, Butterflies, and Diagonals, in simple terms, making them understandable even for beginners. (Several reviews)
- Hands-On Learning: The course encourages students to apply the strategies using the ToS platform, which is valuable for practical learning. (Multiple reviews)
- Introductory Value: It serves as a good introduction to advanced option strategies such as Ratio spreads, Diagonals, and Butterflies. (Review)
- Clear Communication of Risks: The course highlights the risks associated with exotic options, emphasizing the potential for significant losses if not used cautiously. (Review)
Cons:
- Complex Strategies: Some users found that the strategies explained go beyond basic level and might be too advanced for beginners expecting more introductory content. (Reviews)
- Lack of Trading Guidance: There is a need for more on when and how to trade certain strategies, not just at-the-money prices. (Review)
- Practical Implementation: Some users felt that the course focused too much on theoretical aspects using ToS without enough guidance on implementing strategies with real money. (Review)
- Course Labeling: The course was described as 'exotic' and potentially risky, which might not match the label of 'beginner' if expecting more straightforward trading strategies. (Reviews)
Additional Notes:
- Personal Success: One user reported significant success with the strategies taught in the course after applying them using Hari Swaminathan's methodologies. (Review)
- Educational Value: The course is appreciated for its educational content and is recommended by some users who have taken other courses from the same instructor. (Reviews)
- Paper Money vs. Real Trading: A user highlighted the need to figure out how to get options clearance to trade with real money after understanding the strategies on paper. (Review)
User Experience:
- Engagement and Satisfaction: The course received high marks for engagement, with users indicating they are learning a lot and are impressed with Hari Swaminathan's teaching style. (Several reviews)
- Eagerness for Further Learning: Users expressed a desire to take additional courses from the instructor after completing this one. (Reviews)
Recommendation:
This course is recommended for those interested in learning advanced option strategies, specifically Iron Condors, Butterflies, and Diagonals. It is essential for potential students to be aware of the complexity and risks involved with these strategies before enrolling. The course is beneficial for those who have a foundation in options trading and are looking to expand their knowledge and skills into more sophisticated strategies.