Retail investor: I always buy the cheapest options. Way out of the money. More contracts for my money.


Me: You know WHY those are so cheap, right?
Retail investor: ...because they're a better deal?
Me: no... Because they're are almost certainly expire worthless. Cheap contracts are cheap for a reason.
Retail investor: So I'm just buying lottery tickets in bulk?
Me: Essentially... 20 contracts of garbage... is just more garbage.
Retail investor: So what's the smarter structure?
Me: When I'm ultra bullish about a great company at a good price, I buy call contracts closer to the money & longer... LEAP calls with time/odds/& the companies fundamentals on my side.
Quality over quantity, always.
BLSH-5.48%
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