Dear juliet I know all about the failures /hypocrites selling education It takes a scammer to know a scammer.How did you know a scammer sends private messages, this is your deep guilty conscience? It takes one to know another An executive coach explains how to learn in 2 days what normally takes 6 months
May repeat some of prior answers, but: 1. Selling puts/calls, places a limit on profit; 2. Liquidity, and esp bid/ask spreads, are relatively high in options, and over time, take a toll; 3. Often when mkts make huge moves, the option markets virtually shut down, or the bid/ask spreads balloon, such that one would never trade. Futures, avoid this; 4. I don't think this key element mentioned yet: taxes Stock options (all short term, on the short side,) are taxed at ordinary income rates, at say 35%. Futures have a blended rate, equal to 23%. So the tax rate is 50% higher in stocks/options, which means one needs to make 18% more trading stocks/stock options vs futures. That is an unnecessary hurdle, IMO.
Options is a zero sum game .Options formula is used in most strategies. Using only the option formula , this is thinking only inside the box. Think outside the box and get a bigger edge. 1.Option spreads constructed intelligently create risk reward of 1 to 2.Options help in minimising/controlling risk 2.Trade most liquid options s and p etc 3.Most liquid markets are always liquid indices fx .The profits on liquid markets outweigh all costs , still low risk high rewards plus benefit of premium decay , premium decay is another edge. 4>Most books are written by failures who never profited from options trading , these is the knowledge limitation of the trader .The dumb educating the dumber.
What about bying 800 shares of QQQ selling short 1 NQ contract (as protection), will this be a neutral position? If yes selling 8 call option OTM on QQQ will have very small risk?
plot those calculations on an excel and see risk reward similiar to this Best covered option strategies for premium decay
Trading options is tricky but i agree traders have much better chance in generating decent profits from options more than just trading the underlying , although it wont be from just selling options , i would prefer buying options .