Everything else being equal, is it better to buy higher or lower strike call?

I

IronFist

For example, currently, SNDL 2, 2.5, 3, and 3.5 calls are 0.05. SNDL is currently $1.39. If you wanted to buy a call, does it matter which one you buy since they are all the same price?
 
Can't be the same price otherwise you could buy the 2 and sell the 3.5 for a risk free trade with a 1.5 max profit with no downside.
 
RE: Everything else being equal, is it better to buy higher or lower strike call?


Buy the lower strike (buy as close to ATM as you can afford) - the debit will be more but the payout much higher.
 
If you are performing a backtest on which strike performs the best,you really shouldnt compare the returns of ITM vs ATM vs OTM....A better backtest would be the buy of equivalant deltas for each strike,or an equal fixed dollar amount....Apples to apples

OptionsOptionsOptions said:
RE: Everything else being equal, is it better to buy higher or lower strike call?


Buy the lower strike (buy as close to ATM as you can afford) - the debit will be more but the payout much higher.
More...
 
getthatintoya said:
Can't be the same price otherwise you could buy the 2 and sell the 3.5 for a risk free trade with a 1.5 max profit with no downside.
More...
Feasibly the prices are wrong since it's night data. Darn, I meant to say 4, not 3.5 It goes from 2.5 to 4.
 
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