Selling ATM options with hedge better than selling naked OTM?

People sell OTM options because of the higher probabilities of a winning trade. However, people selling options should look at maximizing payoff instead of just probability. Payoff calculations will sometimes lead to selling ITM or ATM options.

payoff = probability*(reward/risk)
 
prc117f said:
I prefer to buy the occasional steamrollers hoping to catch someone trying to pick up pennies in front of my steamroller so I can collect from whats in his wallet :)
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No offense, but didn't you just said in another thread you shorted GE puts in your son's account, trying to pick up pennies in front of the steamroller?o_O
 
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