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The top strategy for options

I'm in a good mood tonight

Sharing my own options strategy with everyone

Also what I consider the top strategy

That is

Options only take profits, never cut losses

Why say so?

1- The bipolar reversal of options. The world can reverse at any time, we often encounter situations where we take profits too early or cut losses too early. I once went all-in on Lilly's call options, sold at a loss for $0.7 each, and two days later they were worth $10 each. This painful lesson made me decide to only take profits and never cut losses with options from then on.

2- The high returns of options. Actually options don't need to win every time. Many friends recover their capital through options - they might lose 99 times but that one big win gets them out. So if you've carefully selected the stock and strike price and made the move, you must believe in yourself and hold.

Of course there's much more to options, and many experts in the community share their knowledge. I won't show off my limited skills, just share a few simple insights:

1- Don't play small-cap stocks with options. I once shorted a small-cap that rose $200 in a week, ending up with total loss of tens of thousands. The profit/loss on small-caps isn't the main issue - the options volume is too low, so often the stock price moves but the option price doesn't.

2- Go with the trend in options. You must follow the trend with options to make money fast. Make a simple plan pre-market, then adjust direction during trading based on the trend. Going against the trend with options will burn through your capital quickly.

3- Keep some money for adding positions. If you pick the wrong direction, there's still a way to recover. I often take profits even when going against the trend by averaging down at the bottom - just a small rebound lets me exit safely.

That's all, hope this helps with your options trading.

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