{"id":209259,"date":"2021-03-24T01:30:00","date_gmt":"2021-03-23T22:30:00","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/this-clever-bitcoin-options-strategy-brings-pro-btc-traders-big-profits\/"},"modified":"2021-03-24T01:30:00","modified_gmt":"2021-03-23T22:30:00","slug":"this-clever-bitcoin-options-strategy-brings-pro-btc-traders-big-profits","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/this-clever-bitcoin-options-strategy-brings-pro-btc-traders-big-profits\/","title":{"rendered":"# This clever Bitcoin options strategy brings pro BTC traders big profits"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_84 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a23e93af014e\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #dd3333;color:#dd3333\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #dd3333;color:#dd3333\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a23e93af014e\" checked aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/buradabiliyorum.com\/en\/this-clever-bitcoin-options-strategy-brings-pro-btc-traders-big-profits\/#Options_strategies_do_not_face_liquidations_ahead_of_expiry\" >Options strategies do not face liquidations ahead of expiry<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/buradabiliyorum.com\/en\/this-clever-bitcoin-options-strategy-brings-pro-btc-traders-big-profits\/#This_front_spread_with_puts_could_yield_a_10770_gain\" >This front spread with puts could yield a $10,770 gain<\/a><\/li><\/ul><\/nav><\/div>\n<p>&#8220;<strong># This clever Bitcoin options strategy brings pro BTC traders big profits <\/strong>&#8221;<\/p>\n<div class=\"post-content\" data-v-5a136f3a>Bitcoin&#8217;s (BTC) upcoming March 26 options expiry might become the largest ever, with $6.1 billion open interest on the line. With less than 4 days ahead of the settlement date, pro investors will have already set up strategies for the next month.<\/p>\n<figure><img decoding=\"async\" src=\"https:\/\/s3.cointelegraph.com\/uploads\/2021-03\/e18bcdc9-42bf-45cc-b40c-0a239fc909ef.png\"><figcaption style=\"text-align: center;\"><em>Bitcoin price at Coinbase, USD. Source: TradingView<\/em><\/figcaption><\/figure>\n<p>As BTC price has already surged 72.7% since February, most traders are skeptical of another rally taking place over the next couple of weeks. Nevertheless, the $55,000 support has shown strength and is a signal that the uptrend is intact.<\/p>\n<p>Whales and arbitrage desks are somehow optimistic, as reflected by the futures contracts premium and top traders&#8217; long-to-short ratio. The excitement seems more restrained as opposed to mid-March, when the futures premium reached 35% annualized.<\/p>\n<figure><img decoding=\"async\" src=\"https:\/\/s3.cointelegraph.com\/uploads\/2021-03\/6708f2b5-4440-40bf-8682-af572a6ca58b.png\"><figcaption style=\"text-align: center;\"><em>OKEx 3-month future contracts basis. Source: Skew<\/em><\/figcaption><\/figure>\n<h2><span class=\"ez-toc-section\" id=\"Options_strategies_do_not_face_liquidations_ahead_of_expiry\"><\/span>Options strategies do not face liquidations ahead of expiry<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Options strategies provide excellent opportunities for traders who have a fixed-range target for an asset. Using leveraged futures contracts also allows traders to leverage the position, although the stop loss decreases the trade&#8217;s viability.<\/p>\n<p>On the other hand, a trader can create a slightly bullish strategy using multiple put (sell) options. The front spread with puts allows gains with no upfront cost other than the margin requirements for a negative price swing. The same pattern can be used in both bullish and bearish circumstances, depending on the investor&#8217;s expectations.<\/p>\n<p>It&#8217;s important to remember that options have a set expiry date; therefore, the price increase must h<a href=\"https:\/\/buradabiliyorum.com\/en\/category\/download-scripts-themes-apps\/\" data-internallinksmanager029f6b8e52c=\"9\" title=\"Download Scripts &amp; Themes &amp; Apps\" target=\"_blank\" rel=\"noopener\">app<\/a>en during the defined period.<\/p>\n<p>The Bitcoin calendar options below are for the April 30 expiry, but this strategy can also be used on Ether (ETH) options or a different time frame. Although the costs will vary, its <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/general\/\" data-internallinksmanager029f6b8e52c=\"3\" title=\"General\" target=\"_blank\" rel=\"noopener\">general<\/a> efficiency should not be affected.<\/p>\n<figure><img decoding=\"async\" src=\"https:\/\/s3.cointelegraph.com\/uploads\/2021-03\/57ed9db8-dc71-4560-80a7-5a0f92d8e54e.png\"><figcaption style=\"text-align: center;\"><em>Profit \/ Loss estimate. Source: Deribit Position Builder<\/em><\/figcaption><\/figure>\n<p>The suggested slightly bullish strategy consists of buying 0.9 BTC worth of $76,000 put options while simultaneously selling 2.05 of $64,000 puts. To finalize the trade, one should buy 1.31 BTC worth of $48,000 put options.<\/p>\n<p>It is worth noting that derivatives exchanges price these contracts in BTC terms. Thus, the displayed profit and loss above are shown in satoshis (1\/100,000,000 BTC) at the expiry date.<\/p>\n<p>While this put option gives the buyer the right to sell an asset at a predetermined price, the contract seller is committing to buy it. Therefore, put options can also be used for neutral-to-bullish strategies.<\/p>\n<h2><span class=\"ez-toc-section\" id=\"This_front_spread_with_puts_could_yield_a_10770_gain\"><\/span>This front spread with puts could yield a $10,770 gain<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>As the estimate above shows, any outcome between $54,600 (down 4.3% from the current $57,050) and $76,000 (up 33.2%) yields a net gain. For example, a 10% price increase to $62,750 results in a $9,350 net gain, or BTC 0.149. Meanwhile, this strategy&#8217;s maximum loss is $7,600 if BTC trades at $48,000 (down 15.9%) on April 30.<\/p>\n<p>This front spread with put options produces a potential $10,770 gain at $64,000, which is 2.85x more than the loss if BTC price drops 10% to $51,350 on the expiry date. <\/p>\n<p>The multiple options strategy trade provides a better risk-reward for bullish traders seeking exposure to BTC&#8217;s price increase. Moreover, there is no upfront fee apart from the 0.157 BTC margin requirements to cover potential losses.<\/p>\n<p><em>The views and opinions expressed here are solely those of the <\/em><a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/twitter.com\/noshitcoins\"><em>author<\/em><\/a><em> and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.<\/em><\/p>\n<p><template data-name=\"subscription_form\" data-type=\"markets_outlook\"><\/template><\/div>\n<p><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script><\/p>\n<blockquote><p><strong><span style=\"color: #ff6600;\">If you liked the article, do not forget to share it with your friends. 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With less than 4 days ahead of the settlement date, pro investors will have already set up strategies for the next month&#8230;.<\/p>\n","protected":false},"author":1,"featured_media":209260,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"https:\/\/images.cointelegraph.com\/images\/1200_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjEtMDMvZmY5NWIzOWMtNmQ0NS00N2U2LTljODItNjY3MzhjNTRhN2EyLmpwZw==.jpg","fifu_image_alt":"","footnotes":""},"categories":[1],"tags":[74862,81209,74937,74982,74863,74860,75012,74939,73785],"class_list":["post-209259","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-general","tag-bitcoin","tag-bitcoin-options","tag-bitcoin-price","tag-btc-markets","tag-cryptocurrencies","tag-cryptocurrency-exchange","tag-derivatives","tag-market-analysis","tag-markets"],"_links":{"self":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/209259","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/comments?post=209259"}],"version-history":[{"count":0,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/209259\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media\/209260"}],"wp:attachment":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media?parent=209259"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/categories?post=209259"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/tags?post=209259"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}