📄 Option Selling with Hedging – A Smart Risk-Managed Strategy

🌟 What is Option Selling with Hedging?

Option selling is a trading strategy where you sell options (Calls or Puts) to earn a steady premium income. However, naked option selling is risky due to unlimited loss potential. That’s where hedging comes in.

By combining option selling with protective hedges, traders:

  • Limit maximum risk.

  • Secure steady returns.

  • Trade with peace of mind, even during volatile markets.

This makes Option Selling with Hedging one of the most professional and safe ways to generate consistent income from the stock market.

🕒 How Does Option Selling with Hedging Work?

The process involves:

  1. Identifying Market Trend – Using TBI and broader timeframes to check if the market is bullish, bearish, or sideways.

  2. Selling Options – Writing call or put options depending on the trend.

  3. Applying Hedges – Buying a further OTM option to cap risk and protect capital.

  4. Premium Collection – Earning profits from time decay (Theta) while staying safe from big moves.

📊 Why Option Selling with Hedging is Important

  • Safety First – Protects traders from unlimited losses.

  • Steady Income – Earns weekly/monthly premium.

  • Low Stress – Works best in sideways or range-bound markets.

  • Professional Approach – Used by institutional traders and funds.

🔑 Key Aspects of Option Selling with Hedging

1️⃣ Timeframes Used

  • Daily & Weekly charts → To check trend and support/resistance.

  • Intraday charts (15m / 1h) → For fine-tuning entry and exit.

2️⃣ Position Duration

  • Positions usually last a few days to a few weeks, depending on expiry.

3️⃣ Tools & Indicators

  • Triple Balloon Indicator (TBI) → Detects trend direction, sideways conditions, and reversal zones.

  • Option Chain Analysis → To track open interest and support/resistance zones.

  • Implied Volatility (IV) → Helps select the best strikes to sell.

4️⃣ Risk Management

  • Always use hedges (buying protective options).

  • Diversify positions across indices and stocks.

  • Follow strict stop-loss signals from TBI.

5️⃣ Option Selling vs Naked Option Selling

FeatureNaked Option SellingHedged Option Selling
RiskUnlimitedLimited & Defined
Margin RequirementVery HighModerate
Stress LevelExtremeManageable
SuitabilityRisk-takers onlyProfessionals & Retail

🚀 Learn Option Selling with Hedging Using Triple Balloon Indicator (TBI)

The Triple Balloon Indicator (TBI) makes hedged option selling highly effective by:

  • Identifying bullish, bearish, or sideways markets.

  • Pinpointing support/resistance zones for safe strike selection.

  • Providing exact entry and exit signals to maximize premium capture.

  • Reducing risk by guiding where to place hedges smartly.

👉 Want to generate steady income with controlled risk?

Learn Option Selling With Hedging