πππ¬π’ππ¬ π¨π πππ«π’π―πππ’π―ππ¬ - πππ«π ππ
β’ How options can be used
β’ How to trade in options & exit strategy- buyers
β’ Imp of theta decay
β’ How to trade in options & exit strategy -sellers
Time for a Threadπ§΅
Curated in collaboration with
@AdityaTodmal
β’ How options can be used
β’ How to trade in options & exit strategy- buyers
β’ Imp of theta decay
β’ How to trade in options & exit strategy -sellers
Time for a Threadπ§΅
Curated in collaboration with
@AdityaTodmal
β’ The lame textbook def of right but not the obligation etc is simply confusing
β’ This is how you can remember, by understanding the logic of the instruments with your view on the market
β’ This is how you can remember, by understanding the logic of the instruments with your view on the market
β’ In a nutshell: Options are instruments used to express your view on the market
β’ The view could be same but the instruments played by the buyers and sellers could be different
β’ The view could be same but the instruments played by the buyers and sellers could be different
β’ For Option buyers:
β’ Its imp to set a price target
β’ and to set a time target as well
β’ Its imp to set a price target
β’ and to set a time target as well
β’ Time is an important factor to be considered
β’ Movement should outweigh the time decay
β’ Movement should outweigh the time decay
β’ Remember option is a wasting asset
β’ Time decay always works against option buyers
β’ Time decay is the highest when the option nears its expiry
β’ Time decay always works against option buyers
β’ Time decay is the highest when the option nears its expiry
β’ Stock moved up but my CE dint move up πππ
β’ Buying too early in the series means paying higher prem for an OTM option
β’ Remember, OTM option only has time value
β’ Buying too early in the series means paying higher prem for an OTM option
β’ Remember, OTM option only has time value
β’ Exit conditions are very crucial
β’ Evaluate your position everyday whether the theta decay is eroding your option premium faster than the movement you are waiting for
β’ If yes have a SL
β’ Evaluate your position everyday whether the theta decay is eroding your option premium faster than the movement you are waiting for
β’ If yes have a SL
β’ Option selling :betting where the market wont go
β’ Need a broader view over a precise view
β’ Need a broader view over a precise view
β’ Draw a mental probability distribution chart
β’ Theta decay is a friend of option sellersπ€π¬
β’ Theta decay is a friend of option sellersπ€π¬
β’ Exit conditions for option sellers
β’ Time to expiry is less: theta decay will bail you out, ceteris paribus
β’ If its breaking a major support or resistance: exit
β’ Meanwhile: adjustment is the name of the game, to protect from huge MTM swings
β’ Time to expiry is less: theta decay will bail you out, ceteris paribus
β’ If its breaking a major support or resistance: exit
β’ Meanwhile: adjustment is the name of the game, to protect from huge MTM swings
β’ This was a part II Thread on derivatives
β’ You can check out the 1st part hereπ
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β’ Retweet the first tweet and help others find this π§΅
β’ Happy learning π€ to everyone!
β’ You can check out the 1st part hereπ
https://twitter.com/niki_poojary/status/1479803623664017414?s=20
β’ If you β€οΈ this, why not share?
β’ Retweet the first tweet and help others find this π§΅
β’ Happy learning π€ to everyone!
β’ I curate threads on trading & financeπππ
β’ You can check out other threads π on my profile πβοΈ
Follow us:
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Have & happy πͺ𧡠& a safe π· weekend!
β’ You can check out other threads π on my profile πβοΈ
Follow us:
@AdityaTodmal
&
@niki_poojary
for more such interesting Threads!
Have & happy πͺ𧡠& a safe π· weekend!
Please refer to this chart over the aboveπ
Sorry for the typo
Sorry for the typo
β’ β’ β’
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