How do you avoid theta options?
Could you please elaborate on how one can effectively avoid theta options? I'm particularly interested in understanding the strategies or techniques you recommend to mitigate the risks associated with these options. Would it involve diversifying portfolios, hedging, or perhaps implementing specific trading rules? Also, could you discuss any potential pitfalls to be aware of when attempting to avoid theta options? Thank you for your insights.
What is a bad theta options?
Could you please elaborate on what is meant by a 'bad theta options' in the context of financial derivatives? I'm curious to understand the characteristics that define such an option as unfavorable or disadvantageous, and how it differs from more favorable theta options. Additionally, could you provide some examples or scenarios where investors might encounter bad theta options and the potential risks associated with them? Thank you for your insights.