The Options Millionaire High Probability Options Trading
Jan 30, 2024
They explain what high probability options trading means and how probability OTM guides strike selection. A Tesla paper-trade shows large capital exposure despite frequent wins. A short SPY put example highlights tiny premiums vs big notional risk. They discuss emotional costs when wins are common but losses are big and argue for asymmetric risk-reward approaches.
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Probability OTM Is A Snapshot, Not A Guarantee
- High probability means likelihood, not certainty when selling options and the broker's 'probability OTM' shows a snapshot probability at that moment.
- Peter used the probability OTM column and warned those percentages can change quickly and don't guarantee outcomes.
Paper Test Selling Tesla Puts Blew Up Tiny Account
- Peter ran a paper-trading test selling high-probability puts on Tesla and found long winning streaks followed by a single large loss that wiped out gains.
- He sold multiple short-dated Tesla puts in a small account, risking tens of thousands to make small credits like $300.
Always Evaluate Risk Before Taking Credit Trades
- Focus on risk first, not only on probability or credit received; always compare the potential loss to the credit you collect.
- Peter contrasted risking $65,692 to make $300 and advised assessing that risk-reward before trading.