Stop Loss on Options

Discussion in 'Options' started by sjain100, Jan 1, 2018.

  1. Underlying movement is not the only thing that changes option prices. Couldn’t hurt though.
    #21     Jan 3, 2018
  2. 2 good ones are volatility and theta decay.
    #22     Jan 3, 2018
  3. sjain100


    Great point: Underlying is important, however, I should take into account Volatility and Theta decay when it comes to the option price changing. Definitely these 2 are also big ones and can't ignore those when it comes to option price.
    #23     Jan 3, 2018
  4. Hi. It is difficult to make money without making stops, but the detail is in knowing when to do it, you must have a tool that helps you not to fall to the bottom of the losses.
    #24     Jan 3, 2018
  5. sjain100


    Thanks Pedro - yes risk management is definitely important to make money, but slightly difficult to use a stop on an option and not recommended. In that case, any specific "Tool" you would be referring too to reduce your loss??
    #25     Jan 3, 2018
  6. R123


    Yes, it is a guide to check the option, not an exact exit, because volatility and time decay ( theta ) also affect options value. But it alerts you to monitor your possible exit versus an untimely Stop out.
    #26     Jan 3, 2018
  7. sjain100


    Yes good point R123. Time decay and volatility also can change options value.
    #27     Jan 3, 2018
  8. Buy1Sell2


    I thought being long options WAS a stop loss. Isn't that the idea?
    #28     Jan 3, 2018
  9. Pekelo


    You still can sell it at 1/3 or half loss...
    #29     Jan 3, 2018
  10. ironchef


    But OP is day trading options.
    #30     Jan 3, 2018