What underlying do you prefer-high priced or lower priced stocks?

[antares66]

In my opinion a relative cheap call/put option on a high priced stocks offers the best opportunity for big % gains because of delta. If a $ 400 stock rises by 5% percent it´s
$ 20. If the option has a 0.5 delta the call gains $10. With a cheap stock ($5-$20) the gain is much smaller. This stock would have to explode to get such a gain. Or you would have to buy a lot of options on the cheap stock. Is my assumption right? Does it make sense to concentrate more on higher priced stocks when considering to buy a call?
Example Moderna today: The 09.17.21, $430 call, rose by 141% as MRNA rose by 7%.

 

[OptionsOptionsOptions]

RE: What underlying do you prefer-high priced or lower priced stocks?

Higher priced stocks such as GOOGL, AAPL, AMZN, MSFT, FB, TSLA, SPY, QQQ

 

[antares66]

RE: What underlying do you prefer-high priced or lower priced stocks?

Higher priced stocks such as GOOGL, AAPL, AMZN, MSFT, FB, TSLA, SPY, QQQ

Thanks for your answer. I agree.

 

[murray t turtle]

RE: What underlying do you prefer-high priced or lower priced stocks?

Higher priced stocks such as GOOGL, AAPL, AMZN, MSFT, FB, TSLA, SPY, QQQ

Mostly, qqq SPY;
lower priced some times sqqq, sds,sdow.........................................................

 

[The_Krakenite]

I think some other points you could add to your argument...

For the same $5 spread (or other value) between bid/ask... the damage is mitigated more-so with the higher value stock.

And we could also throw in commissions arguments too. A simple $2.50 commission fee is less of a drag on $100 stock, than say $10 stocks. [All else being equal]

 

[morganpbrown]

I'll tell you what I hate: a low-priced stock with 5-cent-increment option pricing and poor liquidity. Every round trip has 20 cents in rouding error. 20 cents on a 5-dollar stock is more than a rounding error!