Due to some restrictions, I am not allowed to sell options on individual stocks, so I was just wondering if it's possible to make money selling options on indexes. If so any resources for learning how to do it is appreciated. Thanks.
Can you make money selling options on indexes?
byu/psy_cho_path inoptions
Posted by psy_cho_path
8 Comments
Yeah stack SPY shares if you wanna do that
If you know how to make money on equity options you will make money on index options.
SPX is where it’s at!
I do it in SOXL lol. It’s a great money maker if you can handle the swings
This is the entire premise of Tastytrade…. Selling 16Delta Strangles or just Puts on Spy. They do a ton of other stuff, but for Tom and Tony, that is the goto. Here are some vids (Also they approve anyone who breaths air for Selling options… sorry no sharks but dolphins are ok).
Strangles
http://ontt.tv/2dMq2De Portfolio Allocation for Strangles: Part 2 Oct 3, 2016
http://ontt.tv/29UTPKb Allocating Capital For Strangles Jul 18, 2016
https://ontt.tv/ZhM7S How to Manage Trades in IV Drops and Peaks Sep 20, 2024
https://ontt.tv/2B7hMgt Strangle Analysis Aug 13, 2018
http://ontt.tv/1NxBik1 Mechanically Managing Strangles Aug 20, 2015
http://ontt.tv/2biMncm Manage Losers? Aug 19, 2016
http://ontt.tv/2mgjTmS Comparing 30 Delta Breakevens to 16 Delta Strikes Feb 23, 2017
https://ontt.tv/X0I64 Correlation Between Strangle and Iron Condor May 29, 2024
Nancy is that you?
Can you sell naked calls? On indices?
Sure, of course you can make money on indexes. You can run any strategy you want, so read up on whatever interests you. I’d check Tasty Trade for general strategy info. Personally I just sell 1 dte low delta puts every day with leverage. The main differences with indexes are that there’s no underlying stock to trade so if you want to hold the underlying as part of a strategy then you’d put on a synthetic long or short instead of buying or selling the stock. Also, there are monthly options that expire Friday morning shortly after the market opens but they can’t be traded after Thursday EOD. Then there are daily options that expire at 4pm every day. So you just want to make sure you pick the series you want if you’re trading something that expires on a Friday. The options are cashed settled, so if you have something expire in the money your account will be debited or credited as appropriate overnight. Since the indexes are 1256 contracts, all gains are taxed at 60% LTCG and 40% STCG. Also any open contracts at the end of the year are marked to market and you pay taxes on any profits as of the end of the year.