I trade Index futures ES/RTY/YM and SPX options. Seems like Risk verses reward is much better with options but win rate is lower. Never hold futures overnight. Thoughts?
Since you wrote “options” and not “option” then you’d have to compare thousands of options on SPX and millions of option combinations that people trade. Each combination will have different reward-to-risk and different win rate. Win rates on various options and combos can be between 0.01% and 99.99%.
Agree . Should have specified more. When I trade Options they are OTM and I'm looking for a decent size move hence the better risk verses reward ratio. Only buy calls or puts,nothing fancy.
Then yes, odds are stacked against you. Those are lottery tickets and not traded by pro option traders. When someone trades only options then they mostly use option specific strategies/combos.
TOTAL BS! If you understand "Price TA"... any place where it would be sensible to buy a stock... would be a place to sensibly buy a call. Odds of winning would be HIGH, not "lotto ticket"!!
When buying SPX options it doesn't make sense for me to swing trade ITM options. Usually holding for only a few days. If the market gaps up the OTM options are almost always bigger % gainers.
Just make a note of where you would buy and the value of the option you want. See how the value fluctuates (mid price). Do this a few times. You'll see how much value is lost when price stays flat or doesn't move enough. Typically, options are best in strong trends.