Why Options and not Futures are more popular? Any Options software?

[Scataphagos]

I would not say that an active option trader is more active than an active equity daytrader. Just a different skill to learn.

I don't see "active player" as being relevant. After all, you can be "active" as a "scalper for tics".

The only thing that really matters is the bottom line at the end. Personally, I think "scalping" and "nickel-and-diming" are too tough to bother. Too "busy"... wear yourself to a frazzle... and most likely for marginal results even if "successful because I ended the year in the black".

 

[Robert Morse]

The only thing that really matters is the bottom line at the end of the year.

I agree 100% if you include the risk you took to make that.

 

[CyJackX]

Personally, I'd prefer a higher win rate in exchange for smaller rewards and higher commissions, as that is a quicker indicator to me that something strategically isn't working, and there are more consistent opportunities. Low probability plays sometimes end up working out, but it's harder to tell whether you're just benefiting from variance...

 

[HappyTrader]

A few important key differences that really impact how traders approach the subject:

1) Options can be settled in stock (rather than cash). So if you sell a put and it gets assigned, you only get sold the stock at the put price. Which you can keep and sell later whenever you feel like.
2) Trading in futures, it would normally have been settled in cash (which does not work well for those who would rather settle in position than in cash).
3) Futures tend to be traded on margin which some people would rather not worry or deal with. Options such as Covered Calls require no margin. Likewise Naked Puts can be 'covered' by keeping the correct amount of cash in the account.
4) Options are good if you wish to be specific about which company/stock/ETF you want to track. Granted there are Single Stock Futures (SSFs), but they may not be as liquid as just plain old options.

And of course, if your goal is to leg into a position, or exit a held position, then options are your best bet.

In the end, they really are different beasts with some overlap, and each serve different investment goals and styles.

If you are interested, but new, to futures trading you *may* want to consider the following path:
1) Practice with SPY ETF
2) Then move on to options on SPY ETF
3) Then move on to S&P Futures
4) Then move on to Options on S&P Futures
5) And then?... I don't know, a hedging position in CDS as a bet against the economy with a higher return than shorting S&P ? Let's just stop at #4 for the moment

 

[Ashok Yarlagadda]

Please try www.key2options.com

You can back test any options strategy very fast and easy. No programming required.

 

[SOT Student]

I trade options full time and trade options in 3 different ways, and I have 3 seperate books for each 'strategy'.
Options of futures - Purely directional play on futures, CL, ES, NQ, ZB, ZN, ZS, ZC, 6A, 6B, 6J & 6M to mention a few futures I trade options on.

I also trade options credit spreads when IV is high, I would sell a bear call spread, bull put spread, strangle, Iron Condor or Butterfly on a single stock, ETF or index for a credit with at least 45 days to expire and I would buy back the spread when the premium decays by 50% (50% profit on the spread).

The third strategy is trading 'unusual option activity'. When a big buyer comes into the market and buys options > 500 - 1000 of the normal option activity, I will piggy back - they usual know something. I often get about 1 decent trade a week on this strategy.
For me the best option software out there is TOS (Think or swim), they are now part of TD Ameritrade.

 

[darwin666]

I trade options full time and trade options in 3 different ways, and I have 3 seperate books for each 'strategy'.
Options of futures - Purely directional play on futures, CL, ES, NQ, ZB, ZN, ZS, ZC, 6A, 6B, 6J & 6M to mention a few futures I trade options on.

I also trade options credit spreads when IV is high, I would sell a bear call spread, bull put spread, strangle, Iron Condor or Butterfly on a single stock, ETF or index for a credit with at least 45 days to expire and I would buy back the spread when the premium decays by 50% (50% profit on the spread).

The third strategy is trading 'unusual option activity'. When a big buyer comes into the market and buys options > 500 - 1000 of the normal option activity, I will piggy back - they usual know something. I often get about 1 decent trade a week on this strategy.
For me the best option software out there is TOS (Think or swim), they are now part of TD Ameritrade.

WHAT IF THE unusal option activity is offset by buying shares or selling.. there is too many variables...

 

[darwin666]

A few important key differences that really impact how traders approach the subject:

1) Options can be settled in stock (rather than cash). So if you sell a put and it gets assigned, you only get sold the stock at the put price. Which you can keep and sell later whenever you feel like.
2) Trading in futures, it would normally have been settled in cash (which does not work well for those who would rather settle in position than in cash).
3) Futures tend to be traded on margin which some people would rather not worry or deal with. Options such as Covered Calls require no margin. Likewise Naked Puts can be 'covered' by keeping the correct amount of cash in the account.
4) Options are good if you wish to be specific about which company/stock/ETF you want to track. Granted there are Single Stock Futures (SSFs), but they may not be as liquid as just plain old options.

And of course, if your goal is to leg into a position, or exit a held position, then options are your best bet.

In the end, they really are different beasts with some overlap, and each serve different investment goals and styles.

If you are interested, but new, to futures trading you *may* want to consider the following path:
1) Practice with SPY ETF
2) Then move on to options on SPY ETF
3) Then move on to S&P Futures
4) Then move on to Options on S&P Futures
5) And then?... I don't know, a hedging position in CDS as a bet against the economy with a higher return than shorting S&P ? Let's just stop at #4 for the moment

1) Practice with SPY ETF
2) Then move on to options on SPY ETF

STOP HERE>> HA HA... options on SPY ETFs are the most traded and liquid...