The options that I am familiar with

🌸Take options seriously

Options trading is known as the "pearl on the crown of investment", this is not a compliment, it's a factual description.

The key points are two: ① The complexity of knowledge reserves! In simple terms, it requires higher requirements for operators, because it involves not only the rise and fall of the underlying assets (δ values), but also the amplitude of fluctuations (ν values), and the consideration of time value (θ values). Even for the most basic δ value, you have to consider its rate of change (γ value). Making a single miscalculation could lead to failure! Therefore, a deep knowledge base and rich operational experience are required. ② International large investment funds, hedge funds, securities institutions... all use options for trading. For example, Buffett, Soros, and Duane all are experts in options trading!

In summary, we need to adjust our mindset and take options, this financial derivative, seriously!

👉🏻 Personal perception of difficulty ranking

Fund difficulty 1⭐ can use rsp, can engage in swing trading

A-shares difficulty 2⭐ Band operation for long, value investing for holding long.

Hong Kong and US stocks difficulty 5⭐ Dual-directional operation for long and short positions.

Futures difficulty 10⭐ Leveraged two-way operation, hedging operation.

Options trading difficulty 50⭐ Single leg in four directions + dozens of strategies.

😱😱😱😱😱😱😱😱

Advantages of options

Compared to funds, you can take control actively, attack or defend.

Compared to stocks, you can hedge using strategies against δ value, disregard market fluctuations, take advantage of θ value decay, and ν value fluctuation for arbitrage operations.

Compare futures

①You can use long options to achieve limited loss and unlimited profit - this is comparing speculative operations

②You can use short options to achieve small-scale capital hedging risks - this is comparing hedging operations

My personal safety regulations (operating discipline) for options trading

①Regarding long single-leg options, the capital allocation should never exceed 10% of the total capital

②For short single-leg options, always covered write opening positions, never rely on the market's future and your judgment!

③Every time you open a position, ask yourself what your goal is! Because options combinations vary greatly, common spread strategies (bull spread, bear spread, proportional spread, calendar spread, diagonal spread), straddle strategies (top straddle, bottom straddle, wide straddle), collar strategies, butterfly, composite stock strategies, delta hedging strategies... You need to understand what my view of the market is, and then whether the tools I choose can achieve my view.

For example, if I am bullish on the future market, then how strong is my bullishness? 🌰 The current price is 1 yuan, and it can reach 1.5 yuan by the end of this month, so what kind of operation strategy should I choose?

Directly trade long call, then which price level to choose? In-the-money options? At-the-money options? Out-of-the-money options?

Can do short put at sp 1 or sp 1.5? Obviously, the profit of sp 1 is less than sp 1.5 but the risk of sp 1 is lower than sp 1.5.

Can do sp 1.5+lc1, or can do sp 1+lc1 ...

There are actually many methods, which need to be considered. Your views need to be expressed through your strategy, and your opening actions need to fully and accurately convey your views.

④Exit strategy needs to be planned in advance. There are three types of exit strategies 🦀Natural expiration to zero or exercise 🦀Stop loss exit 🦀Take profit exit. Regardless of which position is opened, plans for these three directions need to be formulated. Commonly used strategies like snowballing, day trading, and praying are all part of operational plans!

⭐Options trading is very complex, yet very tempting. Always maintain a sense of awe, always maintain a spirit of exploration! Do not be discouraged by losses, do not go crazy with victories!