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Earnings plays with long options are really tough when IV has expandaed. 200+ % is a sucker's play :) AFAIK, volatility plays would make more sense if one was inclined to roll that die.

The number of trades you do per day is irrelevant when you are making money. The key is recognizing when opportunity is there not limiting yourself with some preset notion.

Far from expiry, daily decay is minimal. With each day that passes, it increases slightly, getting faster and faster as expiry approaches. Any decent option book will have a graph of theta decay. If you can't afford one :), set up a BS spreadsheet. Can't afford Excel :) ? Go to any web...

Time decay is gradual throughout the day. The option's price will decline steadily unless IV increases. Premium decay is non linear and decays faster as time passes. This effect is greater ATM than ITM/OTM. So in terms of premium per day, you'll get more bang per day with ATM later in...

It's long gamma, short theta with a negative time decay. But the more I think about it, you're right. This trade makes no sense. Far month is more sensitive to IV change and a pop hurts. Gotta go read the article again.

FTURES magazine ha d a brief article about these, suggesting that their useful for expectations of short term IV spikes (buy near month strangle and sell more OTM further month strangle). I've seen them called double diagonals and calendar strangles. Whatever. I've used (ratioed) reverse...

It's paper trading. In terms of results, it won't matter much which broker you use. A better approach would be to determine which broker best suits your needs (commissions, trading tools, margin, etc.) and then use their simulator. That will enable you to get comfortable with it and you'll...

Yes, gamma scalping requires frequent adjustments but it isn't impractical at a low commish broker. If you're long IV, IV contraction hurts. If 75 cent increments generate enough delta to trade and the UL gyrates at 60 ct increments, you don't trade and just decay. If you trade at 75...

Making money year in and year out is a lot of work. It's not play. If straddles returned 3% a year, chances are, you could lose 5% or make double that. Everyone picks different horses and rides em differently :)

There isn't much of a market for previously owned Iron Butt Plugs

WTF does posting an example have to do with expiration risks of Amer vs. Euro settlement?

A clarification... IC's have a higher probability of keeping a smaller profit but when they don't work, you're going to get whacked with a large loss. One way or the other, you're going to have to bring something to the table to make them work over the long haul.

C'mon, you get to keep the premium. It's the stock position you end up with that hurts :D Only sell naked options on stocks you're willing to own (or be short)

You're laser focused on the premium. Daveyc was discussing assignment scenarios. I think by now, everyone gets the picture.

BUTTERFLY: Uses 3 strikes. All puts or all calls. Can also be viewed as 2 spreads. IRON BUTTERFLY: Four options at three strikes. (straddle in the middle). Wings on each side are OTM (strangle). Position can also be viewed as 2 verticals. Uses puts and/or calls. Risk graph is the same...

I don't know if I can add much to Maverick's explanation. With the ETF, something just OTM at expiry will expire. If ITM, it trades at parity. No risk premium left. Yes, if assigned, there's Monday AM directional risk but there's no settlement surprise. With cash settled, you don't...

------------------------------------------------------------------- Quote from spindr0: Sell one each of these and buy two each of those. ------------------------------------------------------------------- The more two each of those costs the less one each of these you get to keep. :)

Sell one each of these and buy two each of those.

How do you spell R-A-T-I-O ?