I have read recently that options are almost taking over trading volume, especially for retail traders..that is us. After trying VERY hard I am throwing in the towel. Sure, I can have a big winner, but it is offset by those that expire worthless. Basically, we have very little chance to make it in a zero sum game against the pro's and market makers.
Options.,... Argh... no more!!
- Thread starter Jdesey
- Start date
Become an investor, wait 40 years and hope the markets 'go up' in that time-frame.
not willing to do that either....but Swing trading,,,holding for days or weeks, I can do that
Sorry, you had bad luck. I think should follow Dest because he’s the Option god in my humble opinion. Reading his journal helped me come back from destroying myself with them.
One of my first trading buddies helped me take a $800,000 gain by August to $300,000 getting me hooked decades ago.
Take some time and learn more option strategies. Sounds like you were mostly buying options. There's other ways to play them.
You got it wrong buddy. This is merely, a question of risk management. You do not have to wait till your options expire worthless. Most times, you got enough monies left to roll over into the next trade, the trade that could end up a big winner. They claim options sellers win 80-90%, I am not sure which one. Anyways, I find it hard to believe. I win 30-40% of the time buying calls and puts. Of late, where I cut my losses faster, I am at 55% winners so, how the hell do the options sellers get that 80% win rate? I think some people are lying about their actual win rates selling options and two, they are making paltry $50-$100 per contract profit but, giving it all back when they lose the big ones in the thousands. I tried selling options premium and lost thousands. I will take risking a few hundred per contract to win several multiples of my risk as my reward every day of the week. It is a no brainer. Just my 2 cents.
For me, it's difficult enough to maintain desired exposure at all times trading stocks and futures.
It's a lot more difficult with options, being non-linear and multivariant. Maintaining desired exposures require continuous monitoring and trading, often introducing other strikes / dates into the portfolio in order to hedge efficiently, leading to higher commission and losses to spread. Portfolio will become messy and complicated, all of these for very little or no extra value.
I told myself all the time to keep things simple and avoid options, but every now and then I still cannot resist...
It's a lot more difficult with options, being non-linear and multivariant. Maintaining desired exposures require continuous monitoring and trading, often introducing other strikes / dates into the portfolio in order to hedge efficiently, leading to higher commission and losses to spread. Portfolio will become messy and complicated, all of these for very little or no extra value.
I told myself all the time to keep things simple and avoid options, but every now and then I still cannot resist...
Same for me years ago. It took me a while to accept the fact the odds are so much against the retail dudes (you and me) with option buying and selling.
Now when I trade options, I just buy calls or puts, nothing fancy, about 5 times a year, only when I see a specific pattern. In that case my goal is not earn more, just to control at 100% my risk on this specific trade.
I am still relatively new to options (only traded for 3 years now)...but have come to the conclusion that they are extremely hard to master to the point that it isn't worth the pain for most people. Learning what it takes to last in the options game is f*cking work because they are extremely complicated compared to equities...and how many retails can make it trading equities?
Options sellers really have the edge but you need a large account balance to make this work...spreads usually have a small return...and can be quite complicated. Knowing which spread to place in which situation and leg selection etc...takes a lot of experience and I really respect the guys who do this...but it is just plain hard and it hurts losing time and again trying to figure it out.
Long options are what attract all the people with small accounts due to their convex payout scale...and are just about the worst way for a new trader to attempt to make money. If you aren't excellent at timing big moves with equities...you will go broke trading long options. Zero doubt in my mind. Theta is like a tax on patience, tick tock tick tock...IV is like a bipolar jacked-off squirrel: "oh, you're holding calls and the underlying had a green day? great...too bad your position is now red because IV dropped a bit and Theta took a bite out of the premium...sucker".
My reaction anytime someone says they are giving options a go:
Options sellers really have the edge but you need a large account balance to make this work...spreads usually have a small return...and can be quite complicated. Knowing which spread to place in which situation and leg selection etc...takes a lot of experience and I really respect the guys who do this...but it is just plain hard and it hurts losing time and again trying to figure it out.
Long options are what attract all the people with small accounts due to their convex payout scale...and are just about the worst way for a new trader to attempt to make money. If you aren't excellent at timing big moves with equities...you will go broke trading long options. Zero doubt in my mind. Theta is like a tax on patience, tick tock tick tock...IV is like a bipolar jacked-off squirrel: "oh, you're holding calls and the underlying had a green day? great...too bad your position is now red because IV dropped a bit and Theta took a bite out of the premium...sucker".
My reaction anytime someone says they are giving options a go: