How Selling Premium Works When Trading Options

Tom Sosnoff and Tony Battista are premium sellers and use Theta decay to their advantage. Today, they prove why they enter trades where they do and prove this due to Theta decay. ======== tastytrade.com ======== Finally a financial network for traders, built by traders. Hosted by Tom Sosnoff and Tony Battista tastytrade is a real financial network with 8 hours of live programming five days a week during market hours. Tune in and learn how to trade options successfully and make the most of your investments! http://goo.gl/EaF69C Subscribe to our YouTube channel: http://goo.gl/Szl24S Watch tastytrade LIVE daily Monday-Friday 7am-3pmCT: http://goo.gl/EaF69C Download our mobile app, Bob the Trader: http://goo.gl/zgIyco Follow tastytrade on Twitter: https://twitter.com/tastytrade Become a fan of tastytrade on Facebook: https://www.facebook.com/tastytrade Follow tastytrade on LinkedIn: http://www.linkedin.com/company/tastytrade Follow tastytrade on Instagram: http://instagram.com/tastytrade Follow tastytrade on Pinterest: http://www.pinterest.com/tastytrade/

Comments

1. This is, by far, your best video. You should post the names of the researchers who put the 25 hours of work into the study. And please quit bringing people like Tim Sykes and Karen the "Supertrader" on your show -- you're better than that, Sosnoff.
2. Hi Tom/Tony, does any time decay take place intra day or does an option price adjust for the time decay element at the close?If not, liquid spy options could be traded intra day just like penny stocks?
3. i love you guys you are the best!
4. HI Tom, it was an amazing insight for option seller and credit spread traders for this video. So which Strike Price (ATM, 70% OTM, or 90% OTM) one does the trade should sell in the beginning of the trade. It because the stock price moving within the TWO standard deviation range from the current price. Or assuming we done our technical analysis, we always sell the option at the "Support level " plus a buffer safety zone, maybe 1 standard deviation. Therefore, what is the ideal position to take up? ATM strike price or 70%OTM or 90% OTM?
5. I always followed 45dte because of tastytrades research, and wondered why Karen used 55 or so. Looking at the 90% out of the money, it seems there a lot more decay (area on the chart) from 60 to 45, than 45 to 30. I might have to reconsider.
   thanks guys!
6. Why are premiums for some stocks (both 1 standard deviation from the money) so much higher than premiums for others?
7. really great! I'm curious to know how a theta decay chart is created. For example, what sort of test could I do in order to come up with the same ATM curve and OTM steeper curve? tastyTrade fan!! (thumbs up)
8. This is one of the most under rated videos on the channel.  at least 1600 people like it.
9. These slides are excellent to illustrate how time decay works ATM and OTM. Great job guys!