MightyOne wrote:Jalarupa wrote:MightyOne wrote:
Imagine trying to explain why it is better to write options than it is to trade outrights, I don't think that we even want to go there.
So you talking about selling puts and selling calls...?
The seller is the "writer" of the options contract and they are the ones that are collecting premium upfront, which can be used to scale other ideas going forward/?
Yes, I am talking about selling ITM options.
The risk of selling a call is roughly the same as shorting the underlying.
Imagine getting ready to go short and then having someone come up to you and offer you cash to go short.
The risk is 'unlimited' either way & the reward is only unlimited, for outrights, if you can make it that far down the chart.
At least with the option you are getting paid to trade.
Just started reading about options this week. Kind of confusing in the beginning, but gets easier the more you read. But Im starting to see why a trader like you like them so much