Anthony CY Tan
2023-06-18

It’s important to note that selecting strike prices involves a degree of risk and requires careful analysis. When selecting strike prices for options, there are a few factors to consider:

1. Market outlook: Determine your outlook for the underlying asset (e.g., stock). Are you bullish, bearish, or neutral? This will influence whether you choose call options (bullish) or put options (bearish).

2. Volatility: Consider the historical and expected volatility of the underlying asset. Higher volatility may warrant selecting strike prices further out-of-the-money to potentially capture larger price movements.

3. Timeframe: Determine your desired timeframe for the option. If you expect a quick price move, you might choose a strike price closer to the current market price. For longer-term expectations, you could consider strike prices further out.

4. Risk tolerance: Assess your risk tolerance and investment goals. Strike prices closer to the current market price tend to have a higher chance of being profitable but may also require a larger upfront investment.

5. Cost: Evaluate the cost of the option premiums. Strike prices that are further out-of-the-money generally have lower premiums but also lower probabilities of profit.

How to pick strike prices for options?
Picking strike price that's aligned with your strategy is a critical component of one's options trading. When selecting a strike price, it is important to consider the current market conditions, the underlying asset's price movement, and your investment objectives. ---------------------- How do you pick strike prices? What tips or strategies do you use? Have you made any mistakes or learned any lessons from it? What were your most successful and unsuccessful experiences in picking strike prices?
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

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