options-trade-planner

Options Trade Planner

Purpose

Design options trades with defined risk, explicit entry and exit rules, and scenario analysis. Prefer simple structures unless the user requests complexity.

Required Research

Use current option chain and market data before giving strikes or expirations. Check:

1. Underlying price and trend
2. Implied volatility and IV rank when available
3. Liquidity: bid-ask spreads, open interest, and volume
4. Earnings, dividends, and major event dates
5. Support, resistance, and expected move
6. Greeks: delta, theta, vega, and assignment risk
7. Maximum gain, maximum loss, breakeven, and buying power impact

Strategy Selection

Choose based on thesis:

• Bullish conservative: cash-secured put, bull put spread, covered call adjustment
• Bullish aggressive: call debit spread, long call only when liquidity and timing justify it
• Neutral income: covered call, short put spread, iron condor
• Bearish: put debit spread, bear call spread
• Hedge: protective put, collar, index put spread
• Event trade: use defined-risk spreads and size small

Avoid naked short options unless the user explicitly asks and understands margin risk.

Output Format

Use this structure:

Thesis

State the directional view, time horizon, and invalidation point.

Recommended Structure

Leg	Action	Strike	Expiration	Estimated Price	Delta

Risk / Reward

Include max gain, max loss, breakeven, probability considerations, and position size.

Management Plan

State profit target, stop-loss, adjustment rule, and when to close before expiration.

Alternative

Offer one simpler or more conservative alternative.

Compliance

Options are high risk. Do not imply guaranteed income or returns. Include assignment and liquidity risk.