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Ok, how about october november..

What if I sell a credit where max loss is 5% of my liquidity and when I am right I make 1% to 1.5% So I have 70% chances to be right and make 1.5% or 30% chances to be wrong and lose 5%.

1% assuming it expires worthless means the option has to double its value in order to have a 1% profit.

It's certain risk vs uncertain reward; non linearity using the underlying. Just like options. "Cut your losses and let your profits run" An option is a weighted average of all the possible prices the underlying can reach.

I wonder why even trade implied vs realized; hedging tail risk? capture risk premium? Also, volatility skew will play a role. What if I just short the underlying when its last close is lowest of the previous 20 days (breakout pattern)? If I get stopped (market rebound) I lost 1 unit of risk...

When underlying moves outside the butterfly (making it "out of the range") time decay and volatility-decreasing will have negative impact as less and less chances for it to expire "in the range". It's all about underlying absolute level.

When butterfly is "in the range" decreasing volatility and time decay will increase the premium.

Volatility might turn the clock back or forward.

https://investmentu.com/options-trading-myths-realities/ Options Trading with Vic Sperandeo: Myths and Realities

While payoff at expiry is clear what happens when the underlying is either in-the-range (between the strikes) or out-of-the-range before expiration?

I assume one will tend to short options to capitalize on time decay and decreasing volatility as well. Why not trade strategies such as butterfly or (reverse) iron condor where net debit = max loss; the premium will increase (to a redemption value) as time goes by - and volatility goes down, if...

https://www.researchgate.net/publication/329527043_The_Pricing_Models_of_Covered_Warrants_and_Empirical_Study_in_Thin_and_Developed_Markets I run across this paper: "2.2 Hong Kong’s market. The covered warrant has started in Hong Kong since 1989. Since then, this market has beenev aluated as...

Do they have covered warrants?

Can a trader sell volatility just by trading the underlying?

Why not a straddle swap on the vega sector?

Average true range (20 days, SMA) on ES futures is 58 (Volatility). Twice that is 116 (my stop loss; if I buy at 2900 I exit at 2900-116=2784). Multiply that by $5 (MICRO E-MINI S&P 500 multiplier) is $580. That is ~3% of a $20.000 account. I wish my unit of risk was 1.5% but I would require...

If a futures contract notional value is bigger than my liquidity I will not trade it. This is it. Emicros are great as I can finally trade equity indexes along with micro gold. I would suggest forgetting about micro futures if account is below $20,000. A good business plan can be built around this.

I believe trading strategies are just a byproduct of a process machine where you already have an absolute view on the market and a risk plan; options will come into play if they give a better risk/reward rather then using the underlying. Also, one could debate if most of the option strategies...

I'd like to know what an inverted yield curve can cause for real economy. Thanks