This is a basic question I’ve been meaning to ask you guys about.. I trade weeklies I so enter 5-0 DTE trades with a target of 1.00/contract (nothing less than .90) where the p/c ratio is greater or equal to 1%. For example, if the strike price is 100 the premium is 1.0, but if the strike is 300, 1.0 is .33% 0 DTEs trades may vary based on the volatility, but I digress..
I’m curious how you guys approach this or take this into account with your trades. Let’s assume for the sake of argument, you ARE already comfortable with the risk/reward set up of the trade - you like it!
1) What is your target amount you want per contract? and 2) what is the absolute minimum you’ll take for the following: EDIT: If its a spread, what is your target max profit amount/contract.
O DTE
4 DTE
11 DTE
32 DTE
81 DTE
172 DTE
326 DTE
Whichever ones you trade .. You can also express it in p/c percentage as well, like 1%
Oops - you’re correct so it’s 1% not 10 and a 300 would be .33% That’s my bad
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I'll sure to be "mindful" of my phrases next time, but that was really for the group. The only thing I spread is ass cheeks & mustard.
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Clarification ; the higher the IV the better it is - for me.
Higher premium affords use of fewer contracts (more reward) and/or further strikes (less risk)
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Clarification ; the higher the IV the better it is - for me.
Higher premium affords use of fewer contracts (more reward) and/or further strikes (less risk)