Ratio Diagonal Option Strategy

💡 Join the Outlier Pro Patreon Community for weekly livestreams, private community, market & trade analysis, direct Q&A, & more. https://www.patreon.com/OutlierTrading ► Free Guide for Beginner Options Traders. https://www.outliertrading.io/guide ► Subscribe to the Outlier Insights Newsletter. https://outliertrading.substack.com/ ► Join the FREE Outlier Community Discord. https://discord.gg/hYGZUEJpve ► Listen to the Outlier Podcast. https://www.youtube.com/playlist?list=PLAFDZ3YyC4rSe9h-s9XvtxktSm16-7-9L ► Learn About Erik. https://www.outliertrading.io AAPL Ratio Diagonal Trade: https://youtu.be/fG_WirPbFrE 📨 Subscribe to the Outlier Insights Newsletter. https://esinvests.substack.com/ ▬ AFFILIATES ▬▬▬▬▬▬▬▬▬▬ ► 50% off ORATS Options Trading Platform, Backtesting, & More: https://orats.com/esinvests ► 50% off Options Omega Backtesting: https://optionomega.com/register/esinvests ► Barchart Premium - Try for FREE: https://www.barchart.com/get-barchart-premier?fpr=xaiek ► Benzinga Pro - Get 35% Off using Promo Code esInvests35: https://benzinga.sjv.io/esin ▬ VIDEO DETAILS ▬▬▬▬▬▬▬▬▬ #trading #stockmarket #optionstrading 00:00 - Introduction - Overview of the video - Purpose: Explaining the ratio diagonal trading strategy 01:00 - Why This Strategy? - Leverage, defined risk, and efficiency - Benefits for newer traders 02:30 - Structure of the Strategy - Long deep in-the-money option (far DTE) - Short near DTE option 04:30 - Traits of the Long Leg - Importance of Delta and extrinsic value - Example using RTX options 06:30 - Kickers and Short Options - Explanation of kicker options - Criteria for short options 08:00 - Example of Ratio Diagonals - Long calls and short calls - Managing upside risk 10:00 - Strategy Deployment - Creating directional assumptions - Sizing, allocation, and scaling protocols 12:00 - Option Selection - DTE, Delta, and the impact on Theta decay - Choosing the right combination 14:00 - Ratio Management - Balancing long and short options - Adjusting the ratio for optimal performance 16:00 - Management Cycle - Entering trades, checking liquidity - Managing P&L, short options, and scaling out 18:00 - Example Trade: RTX - Step-by-step breakdown of an RTX trade - Managing and exiting the trade 20:00 - Conclusion - Recap of key points - Encouragement to apply the strategy - Invitation for viewer feedback and questions