Over the weekend I saw this tweet.
He is a successful and well respected trader with a huge following.
Like all big traders he writes options to make his profits.
Well, different strokes for different folks.
He is not the only one who thinks like this. Option buyers are the poor traders with neither the money nor the brains to make any profit.
My results over last 2 months ( losses of about Rs. 1.30 lakhs ) add futher credence to what he said and is almost like rubbing salt over a fresh wound.
But on this blog, we are not losers over a longer period. Our results are good. With those results, we can not accept such generalized statements. Option sellers make money most of the time. When they lose, it is just game over. Gone bankrupt. Gone from the market forever. To be replaced by the new heroes of market for next 3-4 years. And the cycle goes on.
Markets are equally good or bad for every type of trader.
This was my reply to that tweet:
I agree that option buying is not feasible beyond a certain level. You can not deploy huge capital in option buying and get opportunities to make big gains regularly.
But a good trader has to trade within own resources of money. A big majority of traders are those who do not have the required capital to even pay margin money for 2 lots. What use is option selling to them?
Market exists for all traders. Not only for those with the money.
We have to chose our way of trading based on our beliefs, knowledge and resources.
Rest is left to the market.
I would like the readers views on this debate.
This post is included in my today’s tweet.
Looking for your replies here as well as on Twitter.