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A highly volatile market can be a nightmare for investors that confine themselves to simply buying shares. Large price movements can push you into losses and cause you to second-guess your investment strategies. Even if you remain strongly convinced on an investment, you may start wondering if you could pick it up at a cheaper price in future.

All of these uncertainties can cause investors to sit on the sideline, potentially missing the opportunities these markets present. There are still great stocks out there and now a lot of them are at fantastic prices.

The other benefit of high volatility markets is that options prices are increased. This means that we can sell options against our stock positions to reduce risk, and in doing so, receive higher options credits than we otherwise would.

Should we time these sold options well over the life of our investment, we can dramatically increase the return that we make on our shares. 

In my latest Thursday members webcast I covered a strategy that involves buying a stock and selling a call option against it. The strategy is known as a ‘Buy-Write’ and it is a strategy that can be used as an alternative to simply buying stock. 

This strategy will profit if the share price rises, but our loss will be reduced if the share price falls.

Watch the video below to see which stock I think is a great opportunity in the current market, as well as an example of how you can invest in the stock using the Buy-Write strategy.

If you’d like to learn more about the Buy-Write and similar strategies, we can an online course covering them. You can view more information by clicking here.