Viewing a single comment thread. View all comments

Youngerdiogenes t1_ja9m6n6 wrote

Reply to comment by polarbearbreeze in and I wouldn't change this system for the world. by moonyou22

Thetagang is overrated and most people lose money on it because they lack discipline.

If you’re interested, you can check out /r/thetagang or just research “covered calls” and “selling cash secured puts” on youtube. Plenty of good material out there to learn the basics.

Let me know if you need help, I’ve been around buying and selling options for years and might be able to answer your questions. Or at the very least point you in the right direction.

12

Drivesabrowntruck t1_ja9mv04 wrote

I think that has a lot to do with what options you’re selling. I do low IV, low Delta options, high volume on stuff I don’t mind owning. I think where many Theta gang guys go wrong is chasing theta, without looking at the underlying.

16

Youngerdiogenes t1_ja9poqx wrote

Thats’s 80% true in my opinion. The other 20% is the lack of discipline. Even when selling safe covered calls on reliable stocks, the newer guys will sell a call on a stock, not realize it’s earnings week. And when the stock blasts past their strike, they suddenly rather keep the stock and buy their contract back for a loss.

Zero game plan and no discipline makes for a bad options salesmen.

8

Drivesabrowntruck t1_ja9pzte wrote

So so true, $DIS was a prime example of this. Had 105 Feb monthlies, thing goes to $123 AH earnings day, nothing but a stone afterwards. It actually finished ITM on OE, stock didn’t get called away. One of the few times I’ve had them finish ITM and not get exercised.

5

viperex t1_jachuqa wrote

> they suddenly rather keep the stock and buy their contract back for a loss

What?

−1

Youngerdiogenes t1_jacpnd6 wrote

That sentence makes perfect sense to people who know the mechanics of thetagang.

1

pan_berbelek t1_jabthep wrote

So could you explain what those Greek letters mean in relation to options? (I haven't yet traded any options, only shares)

0

Youngerdiogenes t1_jabuqyk wrote

I wont spoon feed you info. Google it and if you need help afterwards I would be glad to help

1

lostsomuchmoney t1_jac1djl wrote

I need help with delta and gamma that shit is way too confusing. I got vega theta and rho down but those were the easier ones

0

CodeMonkey1 t1_jae5ooy wrote

Delta is how much the option price will change relative to the stock price changes, and gamma is how much the delta will change as the stock price changes.

Imagine a stock is $100 per share. You buy a call option for $1.00 with a delta of 0.10. If the stock goes to $101, your option is worth $1.10.

At the same time, as the underlying price changes, the delta itself will change. So imagining the above option has a gamma of 0.01. After the underlying moves to $101, the option delta is now 0.11. So if the price moves up again to $102, the option is now worth $1.21 and the new delta would be 0.12.

0

viperex t1_jaci7dr wrote

What delta and what DTE for calls and puts?

0

Youngerdiogenes t1_jacq8l3 wrote

The DTE really depends on you and how much time you have to manage your position.

The delta depends on the stock and your strategy.

.30+ delta is for people who snort cocaine amd share needles.

.20 delta is for people who appear normal but wear womens underwear to big meetings because it makes them feel powerful.

Anything less than .20 is for people who idolize Warren buffet and think pepper is too spicy.

1