Basics of selling option Premium?

spinn said:
I am more than happy to buy or sell whatever the underlying of the option is at expiration in most cases.
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There will come a time when you regret that statement, and then you'll understand that it's a big flaw in a strategy of selling premium.

When you open a short option position, you're putting yourself at the mercy of future events (earnings, black swans, death, destruction, etc.), which you can't predict. Your underlying(s) will get wacked, and you'll end up with a growing portfolio of junk.

Trying to work yourself out of that mess isn't any party.

My advice to you isn't theoretical. It is based on long experience, which has been painfully shared by many option sellers.
 
lindq said:
There will come a time when you regret that statement, and then you'll understand that it's a big flaw in a strategy of selling premium.

When you open a short option position, you're putting yourself at the mercy of future events (earnings, black swans, death, destruction, etc.), which you can't predict. Your underlying(s) will get wacked, and you'll end up with a growing portfolio of junk.

Trying to work yourself out of that mess isn't any party.

My advice to you isn't theoretical. It is based on long experience, which has been painfully shared by many option sellers.
More...

It’s never fun when that happens. But the hundreds of smaller wins make up for it.
 
Or try ratios (which oké are also spreads and naked parts, so better not if you don’t know what can happen).
It’s fun till it’s march ‘20 again. A high vix is a friend and enemy in the same jacket.
 
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