Day Trading Options

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Day Trading Options

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Been the source of my most profitable and most unsuccessful moves in the market.

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Yeah I don’t doubt that

I have occasionally traded options but no where close to day trading. You have to get both timing and direction right. When you get it right you can make big returns. Get it wrong and you could loose the entire bet. It’s very hard to win over the long term. You are a small fish swimming with sharks that have way more tools, training and inside knowledge.

When day trading options, I have tradingview going so I'm monitoring the tech analysis and have a tight stop loss in place in case things don't go as planned, which in the market, can happen quite frequently.

Day trading options is a fricking nightmare. And also the reason I am up 78% since the end of April.

Tread lightly.

I sell the put options at strikes where I would want to buy the stock.

It a useful way to enter a position sometimes.
Most options expire worthless.
I try to generate at least 10% premium on these.


On the calls, I sell at strikes where I would sell the stock.
Most expire worthless.

Rinse and repeat.

It’s not foolproof. I’ve sold some puts with a strike of 50 where the stock plummeted and I had to pay 50 for a stock trading at 25.

I’ve also had some stocks called away at strikes of say 50 when the stock was trading at 100.

All in all, it’s been a good way to generate some income in my retirement accounts.

I know someone that was selling covered calls during the downturn in 1QTR20 and the stock price went down and the calls went up. We had crazy volatility and it was that wacked out.

Lately I've been using options as part of a hedge position. I'm expecting a pullback soon and so now looking at selling covered calls and buying puts.

I focus on covered calls and try and find 3-5% return a week on premiums. I look at ones with 10-15% chance of finishing ITM. I've only had to sell my shares a handful of times, and those were easy to let go for the weekly return.

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and buying puts.

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People with a large one stock position should consider hedging by buying puts at a reasonable price.

It’s all insurance to me. Either you are writing for premium or paying premium. In general, I’d rather write as most options expire worthless.

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Ask Jag_Warrior. He’s the options expert around here, but I think he likes to sell puts and calls and collect premiums mostly

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Yep, that’s pretty much what I focus on in a nutshell. Whenever IV rank/percentile is above 50, along with healthy IV (cause that’s where the money is), I’ll look for opportunities to sell premium (puts, calls, strangles, iron condors, etc.), usually around a 5-15 delta. Occasionally I’ll look at long calls as lottery tickets. There was unusual activity in ATVI just a few days ago. The 12/18/20 83 strike calls were going for 1.43. Now going for 4.45.

The options markets are where shady people doing shady things can play without too much fear of being caught. Unusual activity often bears that out. So us little people have to be aware of the weird things that can happen with price and volume, whether we’re going long or short. Day trading options, because it’s not unusual to see 100%+ ranges through the trading day, would be a bit nerve wracking, IMO. I sometimes do it with SPX weeklys, but not often.

Good luck with it though. As long as you have a good plan (that you follow like it’s law), and you can keep your emotions in check, you can do well with options.

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Been the source of my most profitable and most unsuccessful moves in the market.

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I made some serious gains with options.
I also made some serious losses with options.