Selling options only if you have backup funds to withstand big adverse moves and still have a plan. And when you have that much, it is better to buy stocks the investor way. Almost all big professionals do that. I mean those beyond 10-20cr funds.
I know some traders who made crores, lost crores multiple times selling options. They falter tragically in trending and volatile markets.
They failed to go beyond a level because they didn’t know how to know the trend, which is the same reason they switched from buying to selling.
IMHO a disciplined, successful options buyer has all it takes to become an investor ultimately. The %cagr on a big corpus makes them financially free without anxiety and still grow their net worth.
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Traders think that they need more money to buy 100 lots instead of 10 lots. Actually, they need a mindset.
Money comes easily. Mindset doesn’t
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Mental maturity and stability are required. Not money. Money comes.
Until our thinking changes, our financial standing doesn’t change.
If trading doesn’t change you, you are not progressing
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Option buying is gear one and two. Not required after 15 km/h and 25 km/h. Option selling is the third gear. Investing is 4th gear and overdrive,
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Option buying is like buying futures with a premium as interest of borrowing or hafta. People don’t buy options except for the reason that they don’t have larger money.
Those who have money to short options have either inherited or are blowing their savings OR are geniuses.
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Both buying and selling are good tools. Nothing wrong with both. Both are different tools for different situations and stages imho.
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Both shouldn’t be looked down upon. These are not show-off concepts.
I mean buying and selling options
DIIs FIIs use all tools at their disposal as per the situation. They also buy options.
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