Hello Steve! Thank you for your inspiring videos and the content on this channel. I have a question though, more regarding the butterfly but it also impacts iron condor. This is in the case you are using such strategies on options on shares (like you did here with DJT) instead of options on indexes (like SPX). In a butterfly, the options in which we are short are generally at the money and based on how the underlying price can move during the lifetime of the options, our call or put options can be in the money at some point. And generally speaking, the options on shares are American style, meaning that they can be exercised at any time before expiration. Knowing that, this means that if our short options are in the money, we could be assigned at any time and our contracts would be closed, we would lose the premium and money in the process. How could we react to that? Should we sell another bunch of these same contracts that were assigned to have them back? Should we take the loss instead and close the whole trade? Or should we only do this strategy on European options style, like options on indexes for example? Thanks a lot for your time!
While you technically CAN be assigned at any time, assignment usually does not happen until very close to expiration and if it does happen you would not LOSE premium, that would mean you captured the FULL premium on what you sold the short options for. If you are assigned stock, your position has really not changed so long as your long options are still in tact. If you have not seen it - I urge you to watch this video on assignment: ruclips.net/video/l2v_qAnUqOo/видео.html
Bro I'm learning this world of option trading, right now just doing scalping only buying calls and puts contracts. This channel and your questions shows how much fun I still have ahead. I'll appreciate if you could share interesting sources of knowledge in this, like other YT channels, books or academies. thanks a lot!
Well I am not an expert, I’ve got myself into trading 2 years ago or so and I’m really digging into options since a few months only. I’m working in an online bank so it helps learning and understanding a lot and that’s where I learn a lot actually. But this channel overall is a great RUclips channel for options, and their OptionStrat is fantastic. Sad that it doesn’t cover the options on the European market though. Otherwise, you have many RUclips channels that explain how options work, you just need to type in the search bar what you want to look for. And I would also recommend Investopedia, great explanations there. Then, I would follow what’s going on in the market in general once you understood how options work. Following the news and the company in which you are investing, and so on. I’m not a fan of scalping options though, I’ve tried that but it’s not the best instrument to be scalping. Well everyone has its own strategy and if it suits you, you should stick to it. Good luck out there :)
![[#2024MAMA] BIGBANG (빅뱅) - 뱅뱅뱅 (BANG BANG BANG) + FANTASTIC BABY | Mnet 241123 방송](http://i.ytimg.com/vi/EQsYfiPR9uM/mqdefault.jpg)
Thanks for sharing this. Was good to learn about the platform some more
Glad it was helpful!
Are these real trades or just on paper? How much your margin on 40 contacts for verticals?
Hello Steve! Thank you for your inspiring videos and the content on this channel.
I have a question though, more regarding the butterfly but it also impacts iron condor. This is in the case you are using such strategies on options on shares (like you did here with DJT) instead of options on indexes (like SPX). In a butterfly, the options in which we are short are generally at the money and based on how the underlying price can move during the lifetime of the options, our call or put options can be in the money at some point. And generally speaking, the options on shares are American style, meaning that they can be exercised at any time before expiration. Knowing that, this means that if our short options are in the money, we could be assigned at any time and our contracts would be closed, we would lose the premium and money in the process. How could we react to that? Should we sell another bunch of these same contracts that were assigned to have them back? Should we take the loss instead and close the whole trade? Or should we only do this strategy on European options style, like options on indexes for example?
Thanks a lot for your time!
While you technically CAN be assigned at any time, assignment usually does not happen until very close to expiration and if it does happen you would not LOSE premium, that would mean you captured the FULL premium on what you sold the short options for. If you are assigned stock, your position has really not changed so long as your long options are still in tact.
If you have not seen it - I urge you to watch this video on assignment: ruclips.net/video/l2v_qAnUqOo/видео.html
Alright, understood! Thank you very much for your time and feedback Steve! Always great to watch your content!
Bro I'm learning this world of option trading, right now just doing scalping only buying calls and puts contracts. This channel and your questions shows how much fun I still have ahead. I'll appreciate if you could share interesting sources of knowledge in this, like other YT channels, books or academies. thanks a lot!
Well I am not an expert, I’ve got myself into trading 2 years ago or so and I’m really digging into options since a few months only. I’m working in an online bank so it helps learning and understanding a lot and that’s where I learn a lot actually. But this channel overall is a great RUclips channel for options, and their OptionStrat is fantastic. Sad that it doesn’t cover the options on the European market though. Otherwise, you have many RUclips channels that explain how options work, you just need to type in the search bar what you want to look for. And I would also recommend Investopedia, great explanations there. Then, I would follow what’s going on in the market in general once you understood how options work. Following the news and the company in which you are investing, and so on. I’m not a fan of scalping options though, I’ve tried that but it’s not the best instrument to be scalping. Well everyone has its own strategy and if it suits you, you should stick to it. Good luck out there :)