I don't know. As I have mentioned before options is a TOP-DOWN process. To fully answer your question I will need to know the underlying and projected move - I then will come up with the most suitable option trade, which most likely will be OTM.
If you buy an OTM spread that requires a move in the underlying to become profitable at expiry, then the spread will expire worthless just as the long option will. The short option is further out of the money at inception. It will go in the money 2nd. This is all about appetite for risk and personal preference. If you are OK with a high failure rate but some big wins, then OTM options can be the way to go. Ultimately, options tend to be priced fairly reasonably, so unless you have an edge (prediction of movement in the underlying or volatility), you're probably going to suffer a long slow drain on your account.
I watched a lot of tt but I had my doubts. I don't think there is any free money laying around to be picked up by us newbies selling options to the professionals. Overall options are fairly priced, namely, the market usually does not confer any advantage to either the seller or the buyer, if so, the advantage will be arbitraged away (as I found out myself comparing buy-write to buy & hold). I appreciate what Guru said, as most of us are not capable of trading complicated options - trading volatility, gamma, theta, vega.... So, to be profitable, one needs an opinion of the underlying, market conditions and then buy/sell accordingly. Good luck.
Do they have levels for trading options? Last I remember, if you're granted options trading abilities with Thinkorswim then you can trade whatever strategy you like.
Yes they do. But so far that has not been a limitation as I won't sell naked options. And they told me they would approve if I applied on my margins acc.