Show notes: http://optionalpha.com/show109
Unlimited risk option strategies get a bad rap in the investing community among newbie traders. And while our backtesting research has shown that unlimited risk positions like short straddles and short strangles generate the best overall returns, you might be restricted in trading them because of your account type or just fear the big potential drawdowns. In either case, on today's podcast I want to conceptually walk through how you could covert these strategies into their risk-defined counterparts and limit your exposure. As always, there's no free lunch in the market so if you limit your risk you have to give up something else and we'll discuss the trade-offs on the show together.