Advantages of weekly vs monthly options ?

Quote from ktm:

Since no one has said it yet...It depends on what strategies you are using.

The real benefit is in spreading between them and being able to be more granular in your approach with more strikes. If your strategies don't take advantage of the increased expiry frequency, then the benefit is likely moot.

It's like asking if a car is better than a SUV. Depends on the person and what they are using it for.
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Looking at weeklys for short term directional trades..cheaper cost basis vs monthlyoptions, but wasn't sure if the returns were less, bid ask spread was wider, and the liquidity was an issue as compared to the monthly on the same strike..
 
Quote from Put_Master:

In theory, weeklies are a better deal.
In reality, monthly are a better deal.
Why?
Two reasons.

There may be too much down time "between" weekly trades, as you look for the next trade, thus resulting in a lower dollar and % return result at year end.
Also, if I see a stock and trade I really like, in terms of strike, credit, otm cushion, tech support, probability, quality, ect.... there is no way I'm going to lock in a "puny" weekly credit, just to see the stock take off sometime during the week.

When i see something i really like, I assume it won't stay there for long.
Thus, I intend to make some real money on it when given the opportunity.
And that means locking in the stock for a longer contract.

On the other hand, if you are not too picky about your stock selection, and it's easy to go from one stock to another, then the weeklies are a better deal.


The weeklies will give you a calculated higher % return per trade, but the monthy will probably earn more "actual dollars" for you at year end.
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Sounds like you have experienced this first hand..
 
Quote from rfriend73:

Looking at weeklys for short term directional trades..cheaper cost basis vs monthlyoptions, but wasn't sure if the returns were less, bid ask spread was wider, and the liquidity was an issue as compared to the monthly on the same strike..
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Cost basis, pricing and returns are identical to the monthlies, given volatility, time to expiry etc...

During normal market hours, spreads are comparable to monthlies but after hours can be a bit spotty. When we have normal markets, you can typically get filled overnight with an order that's fair value or a nickel/dime worse.

Liquidity is not a potential issue unless you are pushing many hundreds of contracts.
 
Has anyone been selling bear call credit spreads on the SPX weeklys??.

paper traded since dec, live since mid-jan and its going well.

How your experience selling verticals on weekly?? Has anyone sold a weeklys against a leap?? I am watching FAS,, looks like a good candidate.

Just curious how you guys are doing with selling credit spreads.??

thanks

EF
 
<<< Just curious how you guys are doing with selling credit spreads.?? >>>


I would imagine the credit spreaders are doing just fine in this market.
It's those who are using "bilateral" limited border strategies, who are having a difficult time.
Those potential double credits, via the subsequent "2 sided restrictions",... are turning into, double adjustments, double commissions, double stress, and double ways to lose.

I'm sure the temptation is not to make the adjustment, thinking the market has to correct soon.
But isn't that the same thought from last week, and the week before, and the week before....
 
Quote from Put_Master:

<<< Just curious how you guys are doing with selling credit spreads.?? >>>


I would imagine the credit spreaders are doing just fine in this market.
It's those who are using "bilateral" limited border strategies, who are having a difficult time.
Those potential double credits, via the subsequent "2 sided restrictions",... are turning into, double adjustments, double commissions, double stress, and double ways to lose.

I'm sure the temptation is not to make the adjustment, thinking the market has to correct soon.
But isn't that the same thought from last week, and the week before, and the week before....
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"It's those who are using "bilateral" limited border strategies, who are having a difficult time."

Are you talking about condors here?? I am a novice at best, not totally familiar with all the lingo yet.

thanks

Ef
 
Quote from Eddiefl:

"It's those who are using "bilateral" limited border strategies, who are having a difficult time."

Are you talking about condors here?? I am a novice at best, not totally familiar with all the lingo yet.

thanks

Ef
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There are a number of popular strategies that utilize bilateral border restrictions, and the "IC" is one of them.
Those type strategies come with a number of benefits.
Unfortunately, there are no free lunches with any strategy, as they all have potential downsides as well.
 
Quote from Put_Master:

There are a number of popular strategies that utilize bilateral border restrictions, and the "IC" is one of them.
Those type strategies come with a number of benefits.
Unfortunately, there are no free lunches with any strategy, as they all have potential downsides as well.
More...


thanks P-M


I thought thats what you meant..

EF
 
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