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Why is it possible to get those returns, why are there over and undervalued options? How can you capture those returns?

OK, so when deciding whether to buy or sell and option you compare the implied volatility with the historical realized volatility. But with which historical realized volatility do you compare it with? With the average realized volatility of the whole history of that underlying? With the average...

I'm sorry if I sounded too harsh. I still have many doubts, that's why I'm just reading and asking. I appreciate your help in that precise thread you are referring to. The biggest doubt I have is whether it's worth trying to keep learning about options. Sometimes I feel like someone trying to...

1. Is it possible to make at least 20% expected geometric mean returns per year? With expected returns I mean that you have studied that your strategy in average gives you those returns, considering the expected value of your “play” and the optimal capital management for that strategy. Don't...

$18 is the maximum loss (9000/50)? If I traded this specific spread, I would consider that the maximum loss is much higher, like $40 (a combination of finishing at $1950 and IV rising a lot, which makes sense for such an enormous drop in just 2 days). And then, I would risk only a small part of...

For how many years have you had that kind of returns? The problem with that kind of strategies (specially if you deal with OTM options) is that you need an enormous sample size to estimate what's your real expected profit.

I haven't said that I wanted to go long volatility. I was just asking whether the difference between premium/days was exploitable in any way. But from what newwurldmn has said, I think I understand the reason of that premium/days difference between expirations. Now I wonder why in the case of...

Well, in this case I'm long the front month (week in this case), so that's not a problem. It is indeed, but because the sold position is much higher in nominal terms, so the IV of the first one would have to increase much more than the second one to win money that way (and I'd have to close the...

OK, I think I understand it now, thanks. As time until expiration increases, there are more ways to make the price drop X%. What's the reason why in the case of ATM options those more distant in the future have a lower premium/remaining days ratio?

Bad gamble why? Do you mean in the actual situation, because you consider IV is lower than it "should be"? Anyway, I wasn't asking about opening this specific position, it was just an example, you obviously prefer IV to be as high as possible when entering the position, as you profit from a...

Should they be more expensive also in terms of premium/day? Because that part is what doesn't make sense to me.

I have seen that if you wanted to hedge a long position using puts, the higher the strike of the put, the less you pay per day if you buy puts that expire distant in time. And the opposite happens with OTM puts. If you wanted to hedge your position with OTM puts, it's cheaper per day if you buy...

Sure, like Astrology...

How did you do during 2008? Still averaging a "safe" 5-10% per month?

It was solved automatically on Sunday. The same has happened to me in every options expiration from that one.

I have been trying to contact Interactive Brokers but they don't offer any support until 16:00 EST, so I have thought that maybe someone here could help me. I'd really appreciate it, as I'm very worried. Last Friday I had some in the put options that expired that day. To close those...