• $49 Monthly
  • $125 Quarterly

Membership Options:

Diagonal Spreads Portfolio
Diagonal Spreads PortfolioPortfolio Trade Page

Diagonal Spreads Portfolio

This strategy works similarly to a covered call, except we substitute a cheaper long-dated in-the-money call option for the long stock position. This allows us to achieve a greater rate of return, while still being profitable if the stock rises, goes sideways or even slips a little bit.

  • $49 Monthly
  • $125 Quarterly

Membership Options:

Product Description

Strategy Details

Our analysts create simulated covered calls by selling a short-term call while simultaneously buying a long-term call at a lower strike price. The goal for these trades is to generate a 25 to 30% annualized return. By changing the number of contracts to keep similar dollar amounts invested in each position, we add an additional level of diversification to this portfolio.

Ideal Result

In the best case-scenario, your sold calls are in-the-money during the week before expiration. In that case our analysts will often be able to exit the position for a larger profit than we originally targeted. To do this, you buy back your sold calls and sell our long-term call for a net credit. When we exit these trades early, the credit will generally be larger than the difference between the strike prices of our options.

 

Product Features

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  • Blog Posts

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  • Guided Trades

    Trades picked and published by our analysts and then managed through close with regular updates to subscribers.

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Investing in stocks, bonds, option and other financial instruments involve risks and may not be suitable for everyone.

Prior to buying or selling an option, a person must receive a copy of Characteristics and Risks of Standardized Options. Copies of this document are available at http://www.cboe.com/Resources/Intro.aspx or from your broker. Copies are also available from the Chicago Board Options Exchange, 400 S. LaSalle Street, Chicago, IL 60605. The OCC Prospectus contains information on options issued by The Options Clearing Corporation. Copies of this document are available from The Options Clearing Corporation, 440 S. LaSalle Street, 24th Floor, Chicago, IL 60605 or the Chicago Board Options Exchange, 400 S. LaSalle Street, Chicago, IL 60605. The documents available discuss exchange-traded options issued by The Options Clearing Corporation and are intended for educational purposes. No statement in the documents should be construed as a recommendation to buy or sell a security or to provide investment advice.