Market Measures - April 27, 2021 - Contract Duration and P/L Swings

published 2 weeks ago by tastytrade, Inc.

When choosing a contract duration, the primary goal is to use portfolio buying power effectively. Shorter-term contracts tend to have volatile P/L swings for the majority of their duration, while longer-term contracts require BPR be tied up for a long period of time without generating significant profit. What contract duration gives a reasonable number of occurrences but still has manageable P/L swings? Join Tom and Tony as they discuss contract duration and P/L swings.

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