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r/thetagang
Selling long-dated options so great
Investor summaryNeutral
Selling long-dated ATM options is optimal to avoid short-term whipsaws and profit from roll yield during market cycles.
Bull points
- Long-dated options prevent premature exits caused by short-term headline risks and market whipsaws.
- Generates profit from roll yield when the market recovers and remains unchanged after 3-7 week volatility cycles.
降息与宏观
Post body
Based on my experience, selling long-dated (6+ months) at the money options is optimal for this market.
Since 2024 there has tons of short-term whipsaw due to headline risk. This include tariffs, iran, , inflation, Ai...whatever. So selling short-dated means a high risk of being forced out of position too soon.
There will be these 3-7 week stretches where the market rapidly 3-5% falls and then bounces. If you're selling long-dated options you will make money on the roll yield when the market is unchanged on the completion of these cycles.
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