When I trade any option spread, I do it with an expectation of something occurring or not occurring over a limited time period. Sometimes I want the same strike and sometimes not. Low cost of the spread is not a typical requirement for me.
Two observations: 1) ES and SPX monthlies trade at multiples of the weeklys' volume, but have bid-ask spreads of 2x-4x the weeklies, and a trade put-to-market at the MID may sit the entire day without getting hit. The same trade in the weeklies would be hit pronto. 2) Strikes fill as expiration nears. (And gaps *may* get filled in entirely, or (for far-away strikes) remain through expiration.)
I understand, I sometimes want the strike equal and sometimes I don't, but Im still curious as to why they offer less strike selections in the monthly's?
Why would low cost of a spread not be an issue for you? That's like saying, "here market maker, skim some off the top of my trade". The strikes do matter if limited. AAPL is a good example. Weekly is by $1 and monthly by $5. Monthly is July 21, Weekly is July 7, 14, 28. if AAPL is 147, which it was around open, I could buy a 7/14 atm instead of a monthly deep ITM 2117C145 and I would have a narrower spread than the monthly. That means more profit potential. Now that AAPL @145.79 11.33 ET, good time for 2117C145 monthly,
The net premium has very little to do with how much market maker is going to make on your trade. What matters is delta - if you try to execute a tight zero-cost collar it's a god send to AMMs.