You already own 100 shares of a stock and you sell one call option against those shares. You collect the premium immediately. If the stock stays below the strike at expiration you keep the premium and the shares. If it rises above the strike your shares get called away at the strike price — you still profit but miss further upside. Generates income from shares you hold.

Instead of owning 100 shares and selling a covered call, you buy a deep in-the-money long-dated call option (a LEAP — typically 6-12 months out) and sell shorter-dated out-of-the-money calls against it every week or month. The LEAP acts as your share substitute. Much cheaper than owning 100 shares. You collect premium repeatedly from the short calls.

You buy a longer-dated option at a strike and sell a shorter-dated option at the same strike. You pay a net debit. You profit from the difference in time decay between the two expirations — the short option decays faster than the long. Profits most when the stock stays near the strike and IV expands.

You sell an out-of-the-money call spread AND an out-of-the-money put spread simultaneously on the same underlying and expiration. You collect credit from both sides. You profit if the stock stays inside the range between your two short strikes at expiration. Four legs total.

You buy one lower strike option, sell two middle strike options, and buy one higher strike option — all at the same expiration. The middle strike is equidistant from both outer strikes. You pay a small net debit. Maximum profit occurs when the stock pins exactly at the middle strike at expiration.

You own 100 shares, buy an out-of-the-money put for downside protection, and sell an out-of-the-money call to fund the put cost. The short call caps your upside gain. The long put limits your downside loss. The two options can offset each other in cost — a zero-cost collar means the premium from the call equals the cost of the put.

Two diagonal spreads placed simultaneously — one bullish diagonal and one bearish diagonal. You buy longer-dated options on both sides and sell shorter-dated options on both sides. Similar to an iron condor but with different expirations on each side.

You buy both a call AND a put at the same strike price and same expiration. You pay premium for both options. You profit from a large move in either direction — it does not matter which way the stock goes as long as it moves enough to cover both premiums paid.

You buy an out-of-the-money call AND an out-of-the-money put at different strikes but same expiration. Cheaper than a straddle — needs a bigger move than a straddle to profit but costs less upfront. Profit from a large move in either direction.

You are long stock, long a put, and short a call at the same strike — creating a near risk-free position. Used by professional traders and market makers to capture mispricings between options and the underlying stock.