{"id":375139,"date":"2021-12-02T02:30:00","date_gmt":"2021-12-01T23:30:00","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/this-simple-bitcoin-options-strategy-lets-traders-profit-while-also-hedging-their-bets\/"},"modified":"2021-12-02T02:30:00","modified_gmt":"2021-12-01T23:30:00","slug":"this-simple-bitcoin-options-strategy-lets-traders-profit-while-also-hedging-their-bets","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/this-simple-bitcoin-options-strategy-lets-traders-profit-while-also-hedging-their-bets\/","title":{"rendered":"# This simple Bitcoin options strategy lets traders profit while also hedging their bets"},"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-6a2c07f3c050e\" 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-6a2c07f3c050e\" 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-simple-bitcoin-options-strategy-lets-traders-profit-while-also-hedging-their-bets\/#The_150_to_1_risk-reward_ratio_is_moderately_bullish\" >The 1.50 to 1 risk-reward ratio is moderately bullish<\/a><\/li><\/ul><\/nav><\/div>\n<p>&#8220;<strong># This simple Bitcoin options strategy lets traders profit while also hedging their bets <\/strong>&#8221;<\/p>\n<div class=\"post-content\" data-v-128018ef>For traders who are undecided on Bitcoin&#8217;s (BTC) move, the &#8220;long condor with call options&#8221; yields optimal results with very low risk. This strategy offers protection down to $53,500, which would be a 7% downside move from the current $57,600, and returns a positive outcome up to $67,500.<\/p>\n<p>Options markets provide more flexibility to develop custom strategies. Unlike futures, there are two separate instruments available. The call option gives the buyer upside price protection, while the protective put option offers the opposite. <\/p>\n<figure><img decoding=\"async\" src=\"https:\/\/s3.cointelegraph.com\/uploads\/2021-11\/f19e6cae-a6d2-43b4-9b67-0e4351fd6933.png\"><figcaption style=\"text-align: center;\"><em>Bitcoin options strategy returns. Source: Deribit Position Builder<\/em><\/figcaption><\/figure>\n<p>This long condor strategy has been set for the Dec. 31 expiry and uses a slightly bullish range. The same basic structure can also be <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>lied for other periods or price ranges, although the contract quantities might need some adjustment.<\/p>\n<p>Bitcoin was trading at $57,600 when the pricing took place, but a similar result can be achieved starting from any price level. The minimum contract size depends on the derivatives exchange, but one needs to keep the suggested ratio to hold the overall strategy structure.<\/p>\n<p>The first trade requires buying 0.54 contracts of the $52,000 call options to create positive exposure above this price level. Then, to limit gains above $56,000, the trader needs to sell 0.50 BTC call option contracts. <\/p>\n<p>To further limit gains above $64,000, another 0.45 call option contracts should be sold. To complete the strategy, the trader needs upside protection above $70,000 by buying 0.41 call option contracts if the Bitcoin price skyrockets.<\/p>\n<p><strong>Related: <\/strong><strong><em>3 reasons why Bitcoin\u2019s drop to $56.5K may have been the local bottom<\/em><\/strong><\/p>\n<h2><span class=\"ez-toc-section\" id=\"The_150_to_1_risk-reward_ratio_is_moderately_bullish\"><\/span>The 1.50 to 1 risk-reward ratio is moderately bullish<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>The strategy might sound complicated to execute, but the margin required is only 0.0152 BTC, which is also the max loss. Traders should remember that it is also possible to close the position ahead of the Dec. 31 expiry if there&#8217;s enough liquidity. <\/p>\n<p>The max net gain occurs between $56,000 and $64,000 at 0.0233 BTC, which is 50% higher than the potential loss. With 30 days until the expiry date, this strategy gives the holder peace of mind because unlike futures trading, there is no liquidation risk.<\/p>\n<p>Furthermore, having a profit range that varies from a 7% downside move to a positive 17% price change seems conservative and covers a decent $14,000 price range.<\/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><\/p>\n<\/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. Follow us on\u00a0<span style=\"color: #ff0000;\"><a style=\"color: #ff0000;\" href=\"https:\/\/news.google.com\/publications\/CAAqBwgKMLG0nwswvr63Aw\" target=\"_blank\" rel=\"nofollow noopener noreferrer\">Google News<\/a><\/span>\u00a0too, click on the star and choose us from your favorites.<\/span><\/strong><\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\">For forums sites go to <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/forum.buradabiliyorum.com\/\" target=\"_blank\" rel=\"noopener\">Forum.BuradaBiliyorum.Com<\/a><\/span><\/strong>\n<\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\"><strong>If you want to read more <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/news\/\" data-internallinksmanager029f6b8e52c=\"2\" title=\"News\" target=\"_blank\" rel=\"noopener\">News<\/a> articles, you can visit our <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/en.buradabiliyorum.com\/general\/\" target=\"_blank\" rel=\"noopener\">General category.<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<p><span style=\"color: black;\"><a style=\"color: #ff9900;\" href=\"https:\/\/cointelegraph.com\/news\/this-simple-bitcoin-options-strategy-lets-traders-profit-while-also-hedging-their-bets\" target=\"_blank\" rel=\"noopener\">Source<\/a><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>&#8220;# This simple Bitcoin options strategy lets traders profit while also hedging their bets &#8221; For traders who are undecided on Bitcoin&#8217;s (BTC) move, the &#8220;long condor with call options&#8221; yields optimal results with very low risk. This strategy offers protection down to $53,500, which would be a 7% downside move from the current $57,600,&#8230;<\/p>\n","protected":false},"author":1,"featured_media":375140,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"https:\/\/images.cointelegraph.com\/images\/1200_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjEtMTEvNjAxZTM4ZjYtY2JiNC00MTUyLTg0NWEtMjQwNTk1OWY3ZGJhLmpwZw==.jpg","fifu_image_alt":"","footnotes":""},"categories":[1],"tags":[74862,81209,74937,74863,74860,75012,110520,74939,79248,75541,73785],"class_list":["post-375139","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-general","tag-bitcoin","tag-bitcoin-options","tag-bitcoin-price","tag-cryptocurrencies","tag-cryptocurrency-exchange","tag-derivatives","tag-how-to-crypto","tag-market-analysis","tag-trading101","tag-volatility","tag-markets"],"_links":{"self":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/375139","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=375139"}],"version-history":[{"count":0,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/375139\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media\/375140"}],"wp:attachment":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media?parent=375139"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/categories?post=375139"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/tags?post=375139"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}