Long tail options are not comparable to lotto tickets. Lottery tickets have 1) known odds 2) known payoffs; long options & naked options do not possess these two characteristics... this is non-comparable. Lottery-ticket fallacy: the naive analogy equating an investment in collecting positive black swans to the accumulation of lottery tickets. Lottery tickets are not scalable. Makes sense? The two are NON COMPARABLE, they possess different characteristics & properties.
Attempting to protect those who pass by. Convincing him isn’t the goal. I feel rude and guilty talking and calling out but I must because his advice has major consequences to those who listen to it.
He said he used to make millions trading. Like many posters here, some of his posts made sense but some didn't.
I would say there is nothing inherently bad in selling premium, however one must first know the associated risks.. on top of that, I'd rather short a straddle or a narrow strangle rather than the far away wings
if you sell prem like a pro you'd know. but since other novices rather bad mouth what you don't understand, i will waste my time and state - it has to do with the premium. amateurs who drive go karts would suggest to indy racers to use regular unleaded gas rather than expensive racing fuel because it's dangerous. if you didn't understand that - how about if your going to be a robber why rob a kid's lemonade stand. if you're going to sell options might as well make the big bucks and sell them close where you collect the most premium.