Options | FEB 2011
The Expiration Trade by Joe Luisi
In this world of algorithmic trading, how can an independent trader stand a chance? Here’s one way you can trade options to get an edge in the markets. We have all heard that 70% to 80% of all options expire worthless. Many of us have purchased options, only to watch the market move in the direction we anticipate and still lose money as the option we bought drops to zero. I’m not sure whether the percentage of options that expire worthless is correct and there have been articles published about that statement in general, but the one thing I do know is that all out-of-the-money options expire worthless. The key is to determine where that “out of the money” is.
by Joe Luisi
Technical Analysis of STOCKS & COMMODITIES
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