[Verse 1]
When you own a stock and want some extra cash
Write a covered call, collect that premium stash
You keep the money but cap your upside gain
If price goes up too much, your shares will be taken away
But if you're worried that your holdings might decline
Buy a protective put, it's your safety line
Pay a premium for the right to sell at strike
Insurance for your portfolio when markets take a hike
[Chorus]
Covered calls and protective puts, hedge your way
Bull spreads rise, bear spreads fall, that's how they play
Straddles catch the big moves up or down
Strangles give you room to dance around
Butterfly spreads and collars tight
Calendar time and income bright
Options strategies, learn them well
Risk and reward stories to tell
[Verse 2]
Bull call spreads when you think prices will climb
Buy low strike, sell high strike, profit over time
Bear put spreads when you think they're going down
Buy high strike, sell low strike, profit all around
Calendar spreads play the passage of time
Same strike price but expiration's not aligned
Sell the near month, buy the distant date
Time decay works for you, just sit and wait
[Chorus]
Covered calls and protective puts, hedge your way
Bull spreads rise, bear spreads fall, that's how they play
Straddles catch the big moves up or down
Strangles give you room to dance around
Butterfly spreads and collars tight
Calendar time and income bright
Options strategies, learn them well
Risk and reward stories to tell
[Bridge]
Butterfly spreads with three strikes in a row
Buy the wings, sell the body, watch profits grow
Long straddle when you think there's volatility
Same strike, same expiration, movement sets you free
Short strangle sells both put and call apart
Collect premium hoping price stays near the heart
Collar protects with put below and call above
Limits risk and reward like a gentle glove
[Chorus]
Covered calls and protective puts, hedge your way
Bull spreads rise, bear spreads fall, that's how they play
Straddles catch the big moves up or down
Strangles give you room to dance around
Butterfly spreads and collars tight
Calendar time and income bright
Options strategies, learn them well
Risk and reward stories to tell
[Outro]
From hedging risk to income streams
Options help achieve your dreams
Master these strategies today
For CFA success along the way