================ As a practical matter ,QQQQ is much more likely to move more % up or down than DIA,SPY; just like apples almost always grow bigger & further north than oranges. QQQQ can be more liquid getting in; getting out , not sure any are that liquid, especially options deep OTM priced that ''cheap''. Also a strike prices you mentioned is much more likely to lose money than ITM or underlying stock. Digs, can you dig it?????
Well, they certainly won't retain value into a market rally. Value retention was presumed to be under static-price in the underlying contract. The strip vols have a rising IV into quaterly reporting season and significant macro news, such as the GDP, Emp#, etc... Certainly it's not nearly as pronounced as in street-volatility.
Right. I will only add that the unhedged position carries much lower greek magnitude with the otm call on a contract-basis. The delta hedged otm call suffers from convergence losses if implied vols are overstated, which plays into the reduced-expectancy. I wouldn't necessarily buy hedged otm calls due to the convergence-risk, but if vols are representative, it's not a riskier trade, per se.