/biz/ - Business & Finance

A serious bit of advice for anyone new to, or interested in options trading:

First, understand what survivorship bias is. The stories you read on wallstreetbets and the pictures people share of their 2K -> 10K -> 75K -> 190K gains aren't the norm. They're not even close to the norm. These are once in a lifetime plays that few are ever graced with the good fortune to experience. Be extremely realistic, and mentally prepare yourself to lose.

On that note, don't ever gamble more money than you're willing to part with. Options contracts can and do go to zero all the time. You can and will lose your entire investment. Don't ever chase losses, and don't ever feel guilty for taking a profit. If you sell a batch of contracts for 1K that moons to 10K afterward, don't sulk, and don't covet.

Weeklies are dangerous. Don't let the cheap premiums tell you otherwise. Be able to justify your plays, and take it on the chin if you lose.