why don''t people just sell options instead of trading minis?

[Trading Education Buyer]

You on about forex teacher, made my ignore list last night, posted a pdf or something a few days ago, defo!

Dear juliet

I know all about the failures /hypocrites selling education

can anybody post constructively , how do do it like a pro?

it is doable without getting hurt.

WARNING WARNING STEALTH VENDOR ALERT! prepare for private messages offering free tutoring and help.

Thinks he is using "reverse psychology" by calling itself a BUYER when it is a seller.

Folks, we are dealing with a dangerous snake-- BEARWARE!

It takes a scammer to know a scammer.How did you know a scammer sends private messages, this is your deep guilty conscience?

It takes one to know another

An executive coach explains how to learn in 2 days what normally takes 6 months

 

[Buy1Sell2]

limited reward--unlimited risk. also--most people not patient enough to watch paint dry.

 

[FLfutures]

It would almost seem like instead of going long or short minis you should just sell a put/call instead...at least you get a nice cushion from the premium if you're wrong initially. the data shows 90% of traders fail, most regardless of duration. Peopel really suck at timing the market, on all time frames. having the premium work to your advantage should at least bump the odds a bit

May repeat some of prior answers, but:

1. Selling puts/calls, places a limit on profit;
2. Liquidity, and esp bid/ask spreads, are relatively high in options, and over time, take a toll;
3. Often when mkts make huge moves, the option markets virtually shut down, or the bid/ask spreads balloon, such that one would never trade. Futures, avoid this;
4. I don't think this key element mentioned yet: taxes
Stock options (all short term, on the short side,) are taxed at ordinary income rates, at say 35%. Futures have a blended rate, equal to 23%. So the tax rate is 50% higher in stocks/options, which means one needs to make 18% more trading stocks/stock options vs futures. That is an unnecessary hurdle, IMO.

 

[Trading Education Buyer]

May repeat some of prior answers, but:

1. Selling puts/calls, places a limit on profit;
2. Liquidity, and esp bid/ask spreads, are relatively high in options, and over time, take a toll;
3. Often when mkts make huge moves, the option markets virtually shut down, or the bid/ask spreads balloon, such that one would never trade. Futures, avoid this;
.

Options is a zero sum game .Options formula is used in most strategies. Using only the option formula , this is thinking only inside the box. Think outside the box and get a bigger edge.

1.Option spreads constructed intelligently create risk reward of 1 to 2.Options help in minimising/controlling risk
2.Trade most liquid options s and p etc
3.Most liquid markets are always liquid indices fx .The profits on liquid markets outweigh all costs , still low risk high rewards plus benefit of premium decay , premium decay is another edge.
4>Most books are written by failures who never profited from options trading , these is the knowledge limitation of the trader .The dumb educating the dumber.

 

[marwanco]

If you want go short , sell put and sell futures/stock , if you want to get long sell call and long stock/futures , risk of choput is reduced .

The premium you receive will be about 3% for puts or calls on indices for 2 months , that 3 % gives you an edge /cushion , price has to go more than 3 % against you before you see loss .

If it goes > 3 % , you can sell second option to get 6% premium on options , if you are clever you get trade your way out of losses by further option trades .1 future /stock = 2 options .

You will find something profitable , if work hard on this , otherwise you will be with charlatans forever.

If you are smart enough , you will also find a strategy that makes 100% a year return , on futures and options.These smart traders are on their yachts not on E T.

Most people are sold the snake oil of price action , technical analysis , trends etc Your data confirms the value of these analyses, plus something else more important , this is hidden by all snake oil merchants and their accomplices.

What about bying 800 shares of QQQ selling short 1 NQ contract (as protection), will this be a neutral position?
If yes selling 8 call option OTM on QQQ will have very small risk?

 

[Trading Education Buyer]

What about bying 800 shares of QQQ selling short 1 NQ contract (as protection), will this be a neutral position?
If yes selling 8 call option OTM on QQQ will have very small risk?

plot those calculations on an excel and see risk reward

similiar to this


Best covered option strategies for premium decay

 

[Surprise]

May repeat some of prior answers, but:

1. Selling puts/calls, places a limit on profit;
2. Liquidity, and esp bid/ask spreads, are relatively high in options, and over time, take a toll;
3. Often when mkts make huge moves, the option markets virtually shut down, or the bid/ask spreads balloon, such that one would never trade. Futures, avoid this;
4. I don't think this key element mentioned yet: taxes
Stock options (all short term, on the short side,) are taxed at ordinary income rates, at say 35%. Futures have a blended rate, equal to 23%. So the tax rate is 50% higher in stocks/options, which means one needs to make 18% more trading stocks/stock options vs futures. That is an unnecessary hurdle, IMO.

SPX options are 1256 contracts so they are treated like futures for tax purposes.

 

[Surprise]

Trading options is tricky but i agree traders have much better chance in generating decent profits from options more than just trading the underlying , although it wont be from just selling options , i would prefer buying options .

 

[just21]

Trading options is tricky but i agree traders have much better chance in generating decent profits from options more than just trading the underlying , although it wont be from just selling options , i would prefer buying options .

Do both, trade for free, https://en.wikipedia.org/wiki/Risk_reversal

 

[Trading Education Buyer]

Trading options is tricky but i agree traders have much better chance in generating decent profits from options more than just trading the underlying , although it wont be from just selling options , i would prefer buying options .

you can use options selling to reduce your premium layout and premium cost , do some calculations