Pick the strategy the market is actually asking for.

Strategy finder

Choose any combination. Click a filter again to clear it. Every card draws its own profit-and-loss curve at expiry, computed from that strategy's actual legs — dashed lines mark the strikes.

How the buckets work

Cohen classifies every strategy six different ways. Three of them are the filters above. The other three tell you what the trade is for, and how badly it can hurt you.

Market outlook

Bullish, bearish, or neutral — but the names lie more often than you would expect. Six strategies are classified opposite to what they are called.

Type of market

Volatile strategies need movement and rising implied volatility. Rangebound ones need stillness and falling volatility. Twenty are volatility-agnostic — they only care about direction. One strategy, the Bear Call Ladder, is indexed under both: it profits at either extreme and loses only in the middle.

Experience

A beginner has five strategies, and none of them are neutral, volatile or rangebound. Every range and volatility structure is multi-leg. Risk concentrates sharply as you go up: novice and intermediate carry zero uncapped-risk strategies between them; advanced and expert carry all seventeen.

Income or capital gain

The most under-used split. Income strategies are theta-positive: you want stillness. Capital-gain strategies want movement. And the danger sits almost entirely on the income side — 12 of the 22 income strategies carry uncapped risk, against 5 of the 36 capital-gain ones.

The worst shape in options

Twelve strategies combine uncapped risk with capped reward. That is unlimited downside for a fixed payment. They are legitimate trades in the right conditions, but they are the ones to size smallest and gate hardest.

The four rules underneath all of it

Strategy selection is the easy part. These are what separate a reference book from an edge, and they appear in every chapter of both source texts.

1   Plan the exit before the entry

Write down the specific assumption the trade rests on — not "I'm bullish" but "NIFTY holds 24,800 through Tuesday." You exit when that assumption is falsified, not when the loss starts to hurt. Decoupling the exit from the P&L is the only version that survives contact with emotion.

2   If you are wrong, get out

3   Roll winners, never roll losers

When a long option moves your way, sell a vertical spread against it: you bank cash and keep the exposure. When a vertical moves your way, sell the overlapping butterfly. Losing positions get one defensive roll, and it must be for a credit — rolling for a debit is paying to stay wrong.

4   Two stops, always — price and time

Almost everyone sets a price stop. Almost nobody sets the second one. Any negative-theta position needs a date beyond which you will not carry it, regardless of P&L: "if the breakout hasn't happened by Friday's close, I'm out." For short premium, add a third — a stop on the structure's own price, at roughly twice the credit you took in, because volatility can rise without your level ever breaking.