Say you have a budget of $1000. You buy $100 SPY/QQQ calls every day. Most will go to 0 but if the move is towards the upside (and stocks/options tend to convex to the upside) you would see a huge gain.
The math comes to you needing a 10x move at least 1/10 times to break even.
What do you think?
UPDATE
I never said this was some genius strategy but a lot of these comments are truly dumb.
- there is no theta. It's 0dte.
- there is no assignment. you are buying the call
- there is no tits up/ lose it all scenario…since you only lose that one small bet at any given time.
- strike price blah blah doesnt matter since you are betting on direction – however i guess it ideally has to be close to in the money for it to actually have a chance to make a big jump
How you actually lose: by bleeding out. by winning less than your starting principal. so the calculus is if you can expect to make more than $1000 over 10 bets on avg or not.
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