Options Mailbag: Three Ways to Play a Selloff

02/22/08 - 04:09 PM EST

Steven Smith

Two good Web sites that provide examples of option-pricing behavior of different strategies under various scenarios are the Chartbender education page and it also offers a downloadable Option Strategy Guide . Another good site is SpreadTradeSystems, which offers online education and some sample examples of how and when to use different spreads.

Remember, there is no one right way; the goal is to try to choose the strategy that best aligns with your expectations.

Steve Smith writes the Options Alerts newsletter for TheStreet.com. Each week Smith prepares a winning cocktail of options trades for his subscribers. He's currently got options plays on a variety of companies including Apple and Joy Global as well as the Spyder Trust.

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Steven Smith writes regularly for TheStreet.com. In keeping with TSC's editorial policy, he doesn't own or short individual stocks. He also doesn't invest in hedge funds or other private investment partnerships. He was a seatholding member of the Chicago Board of Trade (CBOT) and the Chicago Board Options Exchange (CBOE) from May 1989 to August 1995. During that six-year period, he traded multiple markets for his own personal account and acted as an executing broker for third-party accounts. He appreciates your feedback; click here to send him an email.

To read more of Steve Smith's options ideas take a free trial to TheStreet.com Options Alerts.

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