SOL wrote: ↑Wed Nov 10, 2021 2:03 pm
One way for those that are willing to take the risk is to use options on futures. Once again, to try something new, you must be prepared to fail before you succeed. No risk no gain
To me, it's mostly about learning to quantify risk, on a personal level, when it comes to investing.
Options are fairly new to me, so I keep my lot sizes small (usually 4 figures per lot, sometimes more, if expiry is over 12 months, i.e. LEAPs). On the other hand, I am comfortable HODLing and swing-trading precious metals, Ether, BTC, GAMANF stocks, TLT, a few others, etc., so when I see nice, asymmetric set-ups in those sectors, I attack them with bigger lot sizes (minimum 5 figures, often 6 figures, 7 figures a few times a year when I smell blood on the streets, like during March 2020).
If one does all the math, etc., accounting for beta, alpha, blah, blah, the potential risks vs. rewards, etc., overall it probably works out to be the same, assuming one knows what one is doing. E.g. betting small with options is the same as betting big with a position trade.
So increasing one's comfort zone in this context may simply entail betting bigger on a position trade, when one has a certain degree of conviction and experience in a particular sector.
I don't think it's good to get married to a particular trading instrument. Each has its own advantages and disadvantages.
Perhaps another way of saying this is that investing is not like figure skating ... there are no extra points for degree of difficulty in investing. Just because a trading instrument is more complex does not mean it is necessarily better.
