My condor spread on the December oil futures expired worthless and I kept the $1200 in premium that I can collected in october or november. At the time the price of oil was around $55/barrel. My broker suggested that I sell the 70 calls and the 49 puts with a december expiration. We bought the 74 call and the 45 puts for the same expiration.

A condor spread is a delta-neutral strategy and involves a bull put spread and a bear call spread. You sell a call and a put close to the existing price of the commodity [or stock, or stock index].[the call will be higher priced and the put lower]. You then buy another set of calls and puts outside the first set to limit your losses. You should collect a premium based on this and if the price of the asset stays within your 1st set of calls and puts by expiration, you get to keep all the premium. [I hope this makes sense. If you don’t know what a call or a put is, it probably won’t].

The best way to make money with options is by selling the time premium. I’ve learnt this the hard way by losing a lot of money buying options that usually expire worthless.

Here’s a really good book I’m currently reading.

Here’s another good book one of my friends recommended.

Its a bit pricey so i’ll see if the local libraby has it. It probably won’t have it, but its always good to check. Otherwise I’d easily end up spending $2500/year on books.