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4 Ways to Make Money in a Sideways Market

by Shaun Rosenberg

Sideways markets can be hard to profit in if you are trying to catch every little tick. But there are still ways you can profit when stocks are flat. Here they are.

1. Covered Calls

One thing you can do is to sell covered calls. You can simply find a strong stock that you would not mind holding on to for a while and sell calls on it. This allows you to make a consistent income off of your stock as the markets go up and down.

2. Selling Bull Put Spreads

When you sell bull put spreads you profit as long as the stock stays above a certain point. So if you sold a $50/$45 bull put spread on stock XYZ you will make money as long as the stock stays above a certain $50 by expiration.

This way you don't have to find a stock that is going to make a big move up, only a stock that is not going to make a big move down.

3. Selling Bear Call Spreads

Bear call spreads are exactly the opposite. If you sell a bear call spread you make money as long as the stock stays below a given price on or before expiration. So if you sell the $65/$70 bear call spread you would make money as long as the stock stays below $65, which is not asking the stock to make a big move for you to make money.

4. Iron Condors

Iron Condors are just a combination of a bull put spread and a bear call spread. It makes money as long as a stock stays within a given range by expiration. That makes this one of the most profitable strategies during a flat market because you profit as stocks do nothing.

There are others ways to profit when stocks stay flat, but these are among the best.

About the Author: When I was young I wanted to learn how to trade the stock market. So I traveled around the country listening to professional traders talk about how they are making money in the market. Now I understand how easy it is to make money in the stock market and started a site to help others learn.