You’ve probably heard the warnings that options are risky, and most investors choose to avoid the options market completely. It’s true, options can be extremely risky – but you can also trade options in such a way that actually limits your risk, while still offering large potential returns.
Some options strategies open an investor up to unlimited potential losses, but we tend to steer clear of those. Occasionally, our analysts may point out an attractive trade on the far end of the risk spectrum, but we focus on hedged trading strategies at InvestorsObserver. Our trades will typically have built-in downside protection, limited risk, and outsized return potential. Below are some common options strategies you might find in our services.