10x Research's Covered Strangle Strategy to Boost Bitcoin Profits!

Bittime - For Bitcoin investors who want to maximize portfolio apart from spot investments, they now have an attractive option through the covered strangle strategy. This strategy is recommended by 10x Research, which is known for its brilliant reputation in predicting market trends.

What is the Covered Strangle Strategy?

The covered strangle strategy involves holding the underlying asset (Bitcoin) in the spot market and simultaneously selling out-of-the-money (OTM) call and put options. OTM options are buy (call) or sell (put) options with an exercise price (strike price) above or below the current market price.

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How the Covered Strangle Strategy Works

• Selling an OTM Call Option: The investor sells a call option with a strike price that is higher than the current market price of Bitcoin. The sale of this call option provides a premium to investors.
• Selling an OTM Put Option: Investors sell a put option with a strike price that is lower than the current market price of Bitcoin. Selling this put option also provides a premium to investors.

Benefits of the Covered Strangle Strategy

• Potential for Additional Profits: This strategy offers the potential for additional profits regardless of future Bitcoin price movements. The sale of call and put options generates a premium that adds to the investor's profits.
• Price Drop Buffer: Selling an OTM put option provides protection (buffer) against a potential decline in Bitcoin's price. If the price of Bitcoin falls, investors will still incur losses on spot holdings, but those losses will be offset by profits from put options purchased by others.

Also Read: How to Create a Crypto Portfolio: Hassle-Free

10x Research: Covered Strangle Strategy for Bitcoin

10x Research recommends the following covered strangle strategy for Bitcoin.

• Buying Bitcoin Spot: Investors hold Bitcoin directly on the spot market.
• Selling a $100,000 Call Option: The investor sells a call option with a strike price of $100,000, which is 50% higher than the current market price of Bitcoin, with an expiration date of December 2024.
• Selling a $50,000 Put Option: The investor sold a put option with a strike price of $50,000, below Bitcoin's current market price, with an expiry until December 2024.

According to 10x Research, this strategy has the potential to generate additional profits of up to 17% of the option premium received, regardless of whether the price of Bitcoin rises or falls (with certain limits).

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Covered Strangle Strategy Considerations and Risks

This strategy is optimal when market volatility is low. If volatility increases, the value of the call and put options sold may remain longer, reducing the potential gain from the option premium.

In addition, this strategy carries a greater risk of loss compared to spot Bitcoin ownership alone. If the price of Bitcoin falls sharply below the strike price of the put option, investors will experience significant losses.

Thus, it can be concluded that the covered strangle strategy offers the potential to increase Bitcoin portfolio profits. However, it is important to understand the risks involved before implementing this covered strangle strategy.

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How to Buy Crypto with Bittime

You can buy and sell crypto assets in an easy and safe way via Bittime. Bittime is one of the best crypto applications in Indonesia which is officially registered with Bappebti. 

To be able to buy crypto assets on Bittime, make sure you have registered and completed identity verification. Apart from that, also make sure that you have sufficient balance by depositing some funds into your wallet. For your information, the minimum purchase of assets on Bittime is IDR 10,000. After that, you can purchase crypto assets in the application. 

Monitor price chart movements of Bitcoin (BTC) , Ethereum (ETH) , Solana (SOL) and other cryptos to find out today's crypto market trends in real-time on Bittime.

Also Read:

Call Options: Bullish Signal for BTC Price? Opportunities and Risks

Mistakes That Could Destroy a Portfolio in a Crypto Bull Run

Protecting Portfolio, Important Tips to Avoid Margin Calls

DISCLAIMER: This article is informational in nature and is not an offer or invitation to sell or buy any crypto assets. Trading crypto assets is a high-risk activity. Crypto asset prices are volatile, where prices can change significantly from time to time and Bittime is not responsible for changes in fluctuations in crypto asset exchange rates.