Consolidating information in option transactions

If the consolidation turns into a flat-lining chart, you should consider closing the trade and moving on.

We do that with the style and format of our responses.

But with a sizable move, the winning option can sometimes outpace the losses of the other contract, resulting in a net win.

Here is an example using options on CME Group's COMEX gold futures, which have a contract size of 100 troy ounces.

Two common non-directional option strategies that are designed to profit if the underlying makes a significant move, regardless of which direction, are the (ATM), while the strangle buys options that are out of the money.

Depending on the direction and the size of the move the underlying takes, one option will profit while the other loses.