Yes and no. Yes, if the trade (buy an OTM option) goes against me, I expect to lose all my investment. No, when the trade is in my favor, becoming ITM, I never had any problem getting out.
I guess I’m always thinking of futures contracts. If the market moves against you there is no limit to what you can lose. I had a tough loss 20 years ago in oat futures. In markets like that it’s tough to purchase an option for protection. They are usually thinner than the underlying futures contracts.
Then you are trading the wrong futures contracts. Trading thin futures contracts is not as devastating as you make it seem. I should know. But also, I am not trading exotic shit like electricity, weather, or Class IV milk futures.
Looks like we live in two different but parallel universe: We both trade leverage instruments. I don't trade futures, only options, mostly single leg long so my risks are always capped but rewards are uncapped. Most people hates it because you constantly bleed premium. I think I sleep better.