Which Options Make You the Most Money?

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[InTheMoneyAdam]

Holy shitballs mom, some of these comments. OTM options have more leverage on a per dollar basis because their delta is a larger percentage of the value of the option. Hope that clears things up; that was what I was trying to demonstrate in the video.

[BradFinn]

You being back makes my world better!!!

[jayls]

You're spot on about ITM leaps. I buy them during over-selling or long periods of stagnant price movement. I'll also snag ATM or slightly OTM leaps if the price is right. You basically only have to wait for one rally in the stock over a 2 year period, and you're in the green for any of them. I'm up 44% on AGNC (REIT) leaps right now because of it.

[WordofBob]

I buy the 700+ days out of the money QQQ and SPY. Hold for a year and repeat. Leaves plenty of time for covid type events to pass. As I make more money each round I try to lower the strike to reduce risk as Adam explains. This is something that 'felt' right but happy Adam actually explained it. Thanks!

[jackfrostiez]

thank you for breaking down the math and comparing the leverage of both options

[vincentmamotos]

Glad to see this channel back. 1st channel that I started learning options about

[WillCouch]

Adam!! Great freaking video man. So simple yet so informative as always. Dang i'm so glad to see you back, hope you're feeling a tiny bit better everyday. So in this case if i have a few good edges for scalping and I've always just used atm's or just barely itm's but in this case.. if all my plays are 5-20 minutes usually would i maybe be better off to start trading higher lots of otms or maybe even a few less otms that are a couple more days out expiration instead to get some less on theta decay?. Since my plays are so quick i usually get the 0dte if i can.

[bobtheowl]

Other factors to think about. 1) The fees and/or commissions per contract. 2) volume / open interest. These may be negligible is many cases, but before you buy 1000 contracts of something you might need to factor that in.

[Halllaand]

This time last year I considered getting into options without much knowledge and decided to have a consultation with a trade analyst, and it was incredibly insightful. One year and a couple of months in, I truly cannot stress enough how helpful experts in this field are! Keep them coming brother.

[christopherlittle]

Good to see you Adam I learned to trade options years ago with your Robinhood video. You made me who I am today. Glad you're doing better bro.

[hamiltoes]

So glad you are feeling a little better and able to make these videos!

[Mathhead]

I frame this as follows:
1. Leverage is (underlying price) / (premium (per share)) * delta . This is always higher (assuming enough liquidity) for higher premiums.
2. Effective interest rate is theta (per day) / (total premium) * 365.25. This is also higher as premium goes up.
Of course, these are both linear approximations and break down as you get near expiration or if the unsettling price moves substantially. For example, that AMD call might have massive leverage: ($180)/($.20)*0.02 = 18 to 1 leverage, but I'm sure they're is much higher. Probably has an effective interest rate of over 100% APY.

[stevoz]

man, i havnt been on your channel in a while im so happy youve recovered from your neurological condition, youre looking great and your information is still SUPERB and well taught. thanks!

[intelligentcomputing]

Love the new sign-off -- "peace the **** out - deuces" -- LOL!

[daggans]

Glad to see you're back! Caught up on your story and glad to see you recovering! Love your videos! I watched alot of your learning videos back in 2020-2021 and was able to use options to grow my savings to help with my house down payment in 2022. 🖖

[platinummontu]

happy to see you back, you always do a great job of explaining how the backend factors impact changes to option values

[LexiRedbone]

Appreciate the breakdown.

What if you’re anticipating a breakout, like with SNOW? You buy OTM calls 12 months out in anticipation of a fast movement.

All things being equal, I'm buying a bunch of OTM leaps with plans to sell within 2-3 months. If not, sell, and not much premium is lost…

I hope this makes sense. I really appreciate any help you can provide. Glad you’re feeling better - you’ve helped up my trading game tremendously

[matthewandres]

Hey Adam, glad you’re back! Do you have a video on how to use margin effectively while your money is invested elsewhere? Are there any rules you follow to not over leverage yourself while selling puts on margin? Thanks!!

[OmarJano]

Love the channel man. What delta do you go for with leaps?

[cityguide]

I caught a vid of urs yesterday and now this.. which I have not yet watched, I wanted to answer 1st no cheat sheet.. but 1st I must say, im happy ur back n healthy and posting again. .. 1 of the first option vids I ever saw was you explaining what the terms itm/otm meant, what a strike price is😂😢 I mean the BASICS 101 shht and I loved every minute and went on to really getting into understanding options.. how/why they move, the main 6 greeks how each can effect the other blurring the rules a little when key market indicators move..
I.V. the love/passion for markets centers on these instruments.. implied vs actual volatility.
... a quick cheap answer for the vid Q would be to say it's all the same bc that's the mathematical design of an options chain.. black scholls model does...creates prices by probabilities .. it doesn't matter what strike how much time one contract is to another bc greeks adjust and move the same 1contract at 500$ or 100 at 5$ they'll earn about the same but 1 glaring problem with the 100 contracts is when closed thats going to be 100 executed trades that you'll lose 1$ per to meet the bid -ask whereas the 1contract trades only once =1$ loss.... idk that'd be my guess in most cases, I know of a couple outlier situations that might favor the 100cheaps over the 1 I pull it off once in a while and it's 2hrs give or take before expiration the prem drops most all intrinsic value and if you chart correctly n find the one that's moving u can pick up 50-100 contracts for 3-5-7-1000$ and underlying moves 2-3-5-10$ putting you itm 10-20-30k/2hrs YOLO 😂sounds like a youtube scam...