I believe risk management is more important than mastering complex options strategies. Options can be useful for hedging and generating income, but leverage, time decay and volatility can quickly turn an attractive trade into a substantial loss.
For beginners, understanding intrinsic value, implied volatility, liquidity and maximum potential losses should come before exploring straddles or strangles.
Buying both calls and puts does not guarantee profits from volatility. The underlying asset must move sufficiently to overcome the combined premiums and transaction costs, while volatility crush can further reduce returns.
Selling uncovered options introduces potentially substantial or unlimited losses.
Personally, I favour long-term ETF investing over speculative options trading. If using options, I would prioritise defined risks, disciplined position sizing and capital preservation rather than chasing premium income.
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