Basically, I only sell options and trade them carefully. Based on my own experience, I have written some relevant articles, suitable for young people who are new to this trip to eradicate illiteracy. The mage shares the summary
Last weekend, in an essay, I mentioned that short put is more worry-free and has a better chance of winning than short calls. mooer asked why. Let's talk about my understanding here:
First, the overall trend in US stocks is still rising.My understanding is this:
1. The basic logic of investing in stocks is to invest in a company, hoping to enjoy the benefits of growth after the company develops. Therefore, most investors are buying tickets and waiting to increase. That is, buying has always been relatively strong
2. The US economy has always been relatively strong. As long as it's not a period of recession, society is developing and enterprises are growing, most companies are still on the rise
3. Since the most basic logic is that shareholders enjoy the benefits of rising stocks. Therefore, the market mostly rose above inertia. In other words, without using any advantages or disadvantages, there is a greater probability that the stock market will close slightly higher.
Of course, this is just a sensorial phenomenon; you can't rely too much on this logic.
Second, short puts have limited losses, and short calls are theoretically unlimited.
This one, for example, is easy to understand. A short put is a bet that a stock will not fall below a value after it expires. If it falls below, the item will be picked up at this price. That is, in any case, the obligation to sell a put may be to buy some stocks according to the contract after receiving a certain premium...