MulaManic:I think yours is a solid strategy. Most options...

MulaManic:

I think yours is a solid strategy. Most options punters complicate things with butterflies, straddles, strangles, sold call spreads etc.

Directional punting is the best - you know your maximum downside and you have unlimited upside within expiry.

I would like to add a little nugget -

If you're trading directional options, and your record is stellar, think about using this strategy.

Instead of closing out your entire position, leave a few oppies in the open. For example, if you outlaid 5k for 10 oppies at 50 cents, and sold them for a 20% gain at 6k, instead of selling the lot, how about selling 9 oppies at 60 cents, recouping your capital and some profit, and letting that 1 singular option expire.

You will never know what could happen.

I know a guy who did this and had like 20 calls left over.

On expiry day, WMC got bid for and he made an absolute killing.

Building a portfolio of free bets is a sure fire way to make money - especially if your options are longer dated ones.