Not correct. Even 5 points on 35 contracts would not scare me if the leverage is small. The margin per contract defines the leverage and when it gets scary. So 5 points can be less scary than 1 point, depending on the margin/leverage you use.
The house on top was purchased for cash from trading based on per-contract profits. The house below was purchased for cash from trading based on aggregate number of contracts profits.
So you agree that I am right, because with a 500k account it would not be a problem at all. It would not scare you.
it is the same logic, more money in the account and therefore trade bigger the size. margin only comes in play if one trades a lot daily to take advantage of the leverage.
https://www.bloomberg.com/news/arti...ered-65-million-on-stock-rebound-into-holiday While U.S. stocks fell Tuesday ahead of what’s expected to be a hawkish Federal Reserve policy meeting, one investor just bet $65 million on a quick market rebound. The trade saw someone purchase roughly 20,000 call spreads that are linked to the S&P 500 and expire right before the Christmas holiday. The transaction involved selling calls with a strike price at 4,750 to fund bullish options exercisable at 4,650. party on...