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If you’ve spent any time learning about options, you’ve probably noticed something.
One person tells you to buy the cheapest contracts you can find. Another says to always trade weeklies. Someone else insists you should never hold through earnings, while another trader tells you that’s where the biggest opportunities exist…
For new traders — and even experienced ones — it can be difficult to separate trustworthy principles from the latest hot takes on the internet.
That’s one of the reasons I created the
While the Challenge is built around eight core educational lessons and a handful of potent trading tools, one feature has become a favorite among members: our live Q&A sessions.
Every two weeks, I sit down with members for these livestreams and answer whatever is on their minds. Sometimes we’re talking about the market. Other times we’re discussing options trading strategies, unusual options activity, or the finer points of position management.
Nothing is scripted, and no two sessions are ever the same.
The questions come directly from members, which means we’re solving real trading hang ups instead of just talking about hypothetical situations.
Our next Q&A is coming up next week.
Before we get there, I wanted to share a portion of one of our most recent sessions so you can see exactly how these discussions work.
The Biggest Mistake I See Options Traders Make
One of the questions came from a member named Paula.
She asked something almost every options trader eventually asks:
“How do you decide which strike price to buy, and how much time should you give the trade?”
It’s a fantastic question because, in my experience, this is where many traders lose money — not because their market outlook was wrong, but because the structure of their trade was.
Most traders spend nearly all of their energy trying to predict whether a stock is going higher or lower.
Don’t get me wrong that’s critically important — but it’s only half the equation.
The other half is choosing the right option.
You can correctly predict the direction of a stock and still lose money in the options if you buy the wrong strike or an expiration that doesn’t give your idea enough time to develop.
I’ve seen it happen countless times.
The stock eventually moves the way the trader had expected, but the option simply expired before it got there.
Why Strike Selection Matters
When I’m building an options trade, I don’t begin with the option chain.
I begin with the expected move which tells me how far the options market expects the stock to move over a given period. That range becomes the roadmap for the trade.
From there, I look at institutional order flow.
Where are professional traders committing capital?
Which strikes are attracting unusually large options positions?
Those answers matter because institutional investors typically have far more research and experience behind their decisions than the average retail trader.
Whenever possible, I’d rather align myself with that positioning than chase a cheaper, further out-of-the-money option simply because it looks inexpensive.
Buying more contracts isn’t the goal.
Buying better contracts is.
Don’t Get Beaten By the Clock
The second half of Paula’s question involved expiration dates.
This is another area where I think many retail traders make an avoidable mistake: they buy too little time.
I almost always recommend purchasing more time than you think you’ll need.
Why?
Because options aren’t just directional instruments, they’re contracts with an expiration date.
Every day that passes without the stock hitting that expected move reduces the value of that option.
During my years as a market maker on the Chicago Board Options Exchange (CBOE), we sold time for a living.
One of the most consistent mistakes we saw retail traders make was buying contracts with too little time remaining.
Their market thesis wasn’t necessarily wrong so much as their timing window was.
That doesn’t mean giving your trade additional time guarantees success.
However, it does give a well-researched idea the opportunity to play out instead of failing because the calendar moved faster than the stock.
Why Process Beats Prediction
Successful traders understand that nothing in the markets is ever guaranteed.
Instead of chasing certainty, they find their edge, think probabilistically, manage their risk, and give that edge enough opportunity to play out over time.
That means choosing appropriate strike prices, buying enough time, and managing positions with discipline.
Those aren’t flashy topics.
They’re simply the habits that separate consistent traders from everyone else.
That’s why I enjoy these Q&A sessions so much.
Members ask questions that are immediately relevant to what they’re experiencing in the market, and together we work through the reasoning and strategies behind the decisions — not just the answers themselves.
Bring Your Questions to the Next Q&A
The clip up top is taken directly from one of our most recent Masters in Trading Challenge Q&A sessions.
If you’re looking to improve your options trading strategies, I think you’ll find these conversations valuable because they’re focused on practical decision-making rather than theory.
Because the right answer helps you with one trade.
Learning how to ask the right questions improves every trade that follows.
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