Thread by @sanjufunda

LPT vs HPT
One thing commonly I see in new commers they focus a lot on high probability of trade, for that they try to be prefer big range for trading from start. As static edge of most occurance of winning with you no doubt.

Even I go sometimes HPT strategy but after learning a lot found this is also kind of myth to pick big range. So let's start and sharing my experience about it.
Both hv own pros and cons. Both good as well.

1. Low probability of trade: generally hv low probability of profit (POP), but as per risk reward (RR) very good trade but also enough credit to manage with various scenarios easily. Here edge is not statics but your trade management skills.

2. High Probability of trade: hv high winning range but as per RR I always found bad. But sure winning edge is high as per static and sure about 80-90% times u win as well without issues. Only issue I found when if one big loss occur then wiped out all good months profit.

Even with correct management and correct position size we can managed and come out with less risk/loss. As per adjustment few still extend breakeven but notional loss can be hit even before breakeven.

So choosing which type of strategy or system for me depends on situation. Normally when I found good premium and high iv environment; personally start from wide and keep moving towards middle. When no much premium on OTM side I prefer to go LPT.

POP only show range cover as per SD where u r profitable. In example u will understand for small credit how POP can be small or big. Attached snap. If I able to sell few bucks in short then my POP goes from 35 to 85, even both position very high POP.

Decide first wat is ur objective, lookout. Always respect position size and one and only Risk.

Thanks!

One thing I noticed after some comments so adding. As I hv written according my experience and monthly Option. Not considered short term trades- as we go short term our edge of HPT also will be less and more destroyer and less room for management.