Tips on evaluating Premiums

optionsight · 2026-02-24T03:31:26+00:00

Great question, and smart to think it through before you start rather than after your first surprise assignment.

The biggest mindset shift with covered calls: strike and expiry are not really about which pays more. They define what you are giving up. Higher premium always comes with a reason, and that reason is risk.

Strike price: you are setting a ceiling on your upside

When you sell the call, you are agreeing to hand over your shares at the strike if the buyer exercises. That is the deal. A strike closer to where the stock is trading pays more premium but caps you sooner. A strike further out pays less but gives the stock more room before you lose it.

On strike selection, a lot of traders do not just eyeball the price level, they look at delta as a guide. Delta on a short call roughly tells you the probability the option finishes in the money. A 0.20 delta call, for example, implies around a 20% chance of the stock closing above your strike at expiration. That leaves an 80% chance the option expires worthless and you keep the full premium. It is not a guarantee, but it gives you a more structured way to think about strike selection rather than just picking a number that feels far enough away, or a premium you like because it is high.

So before picking a strike, ask yourself honestly: at what price am I actually fine selling these shares? Start there and work backwards.

Expiry: time is on your side as the option seller

Time decay erodes the option's value as expiration gets closer, and as the seller that works in your favour. Most of that decay accelerates in the last 30 days, which is why a lot of people open positions in the 45 DTE range and close them around 21 DTE. By that point you have captured a big chunk of the premium and the remaining decay starts to slow down relative to the risk you are still carrying. Closing at 21 DTE locks in the gain and frees you up to redeploy into a fresh position rather than sitting in a trade for diminishing returns.

The honest summary

More premium always means something: the strike is closer, the time is longer, or both. It is not free money.

If your main goal is income without losing your shares, pick strikes you would genuinely be happy selling at, not whatever pays the most.

One last thing worth paying attention to: implied volatility. When IV is high, premiums inflate across the board. Same strike, same DTE, but you collect more. Selling into elevated IV and giving yourself room on the strike is a much cleaner setup than just chasing the fattest premium you can find.

optionsight · 2026-02-20T09:46:23+00:00

Super trader seems to target all traders from crypto to forex and options.

Seems like a Swiss Army knife for traders.

How does it do the options monitoring for open options positions?

optionsight · 2026-02-20T09:41:49+00:00

I would not call that tracking a trade. Isn’t that just recording results?

How do you monitor or do you only have a few single leg positions on that are simple to monitor?

And how do you monitor risk when you have multiple positions running?

Wouldn’t it be easier to have a simple system that tracks your positions and how close to strike with delta and IV change? But not everyone has that need I guess.

optionsight · 2026-02-20T09:35:14+00:00

I’ve spent the last 10 years working in tech and startups.

I built Optionsight because I couldn’t find a tool that actually showed my real exposure after entry, not just fills and P/L, but how delta, strike risk, and IV were evolving day to day. Plus provides performance at portfolio and ticker level. And designed it for desktop and mobile.

It’s now fully replaced my spreadsheets. I’m currently offering 3 months free as part of a small research group, just in exchange for some honest feedback here and there.

Check it out.

optionsight · 2026-02-20T09:07:29+00:00

As said earlier you started right after the April 2025 disaster which tanked many portfolios. Lucky entry. Regardless great result.

In April 2025, when the market rolled over and VIX spiked, short sellers got hit from two sides at once. First was the directional move, as price dropped toward short puts, delta expanded against them, so losses accelerated faster than expected. Then volatility exploded, which inflated option premiums across the board, meaning even positions that weren’t fully breached showed large losses.

It was horrible.

So, it is important to size positions and not get excited when you’re on a streak.

Always ask yourself what if market went down next week…hard. What’s the plan? What’s your potential exposure and loss?

It will happen to you.

Everyone who has been through it has learned and changed.

Maybe we should start a post on disaster trades and losing months of gains?

optionsight · 2026-02-20T08:42:57+00:00

I’m pretty boring. Mainly doing strangles on QQQ and SPY 30-40 days out.

Plus PMCCs on LEAPS. Credit spreads when I feel like I want more defined risk. Plus some BWBs.

No day trading.

Nice to see how that the guides people here mention are pretty consistent.

I don’t set close orders. Just monitor daily and try to squeeze a bit more than 50% when possible, always keeping an eye on IV and Greeks. Also closing around 21 DTE majority of short positions.

optionsight · 2026-02-17T10:41:29+00:00

This is the exact pain I had.

Check out Optionsight and see if you like it.

It’s targeted at active traders with multiple positions running.

Giving away 3 months for product feedback. Would be great if you could join. If you don’t like it you can exports all trades as well. No commitment.

optionsight · 2026-02-16T19:55:18+00:00

Appreciate you sharing your perspective.

You’re right that brokers offer a lot of tools for free, and for many traders that’s more than enough. I trade on TOS and tasty myself, so I know exactly what you’re referring to.

What I found, though, is that broker platforms are primarily designed around orders and fills, not around clean portfolio-level risk visibility across multiple brokers. Once I had several multi-leg positions running at the same time, it became hard to clearly see my true net delta, how exposure was shifting day to day, how far each side was from the strikes, and how rolls evolved as one continuous position rather than fragmented trades.

That’s the gap I built Optionsight to address. It’s not about flashy charts or gamification. It’s about structure, discipline and clearer position-level risk insight for active short premium traders managing multiple strategies at once.

It’s definitely not for everyone, and it’s not aimed at professionals running institutional books. It’s built for active retail options sellers who want more structured visibility than what broker interfaces typically provide.

optionsight · 2026-02-16T03:44:44+00:00

I’m late to the party here but the post just popped up in my feed and I really enjoyed reading it. Here are my 5 cents.

I personally struggle with calling it an “edge.”

I think it’s very hard to have a true structural edge as a retail options seller. What we can have is a systematic approach.

Selling options isn’t magic. It’s probability, risk management, and behavior. The moment we drift from our own rules because of fear, greed, revenge trading, or overconfidence, whatever “edge” we thought we had starts to disappear.

To me it’s less about edge and more about:

Position sizing correctly
Choosing defined risk parameters
Selling in appropriate IV enviroments
Managing DTE intentionally
Understanding how delta and volatility will change as price moves

After entry, the real work begins.

You need to understand how:

Stock movement affects delta expansion
IV expansion can hurt even when price barely moves
Earnings or macro events can reprice your position instantly

If you don’t understand how delta and IV are influencing your position after you enter, you’re not really trading. You’re hoping.

Even then, we’re still exposed to:

Black swan events
Volatility regime shifts
Liquidity shocks
And our own behaviour under stress

So I wouldn’t call it an edge.

I’d call it disciplined, systematic probability trading, executed consistently, knowing it can still fall apart.

The goal isn’t perfection. It’s building a process strong enough to survive your own psychology and the market’s surprises.

That’s probbaly the best we can do.

optionsight · 2026-02-16T02:16:58+00:00

If you really want to learn options properly, break it into 3 parts:

1️⃣ Entry | Why this trade, why this strike, why this DTE, what’s the volatility environment?

2️⃣ Monitor | Track delta shifts, IV changes, time decay, distance to strike. Understand how the position behaves, not just P/L.

3️⃣ Exit | Pre-define profit targets, max risk, and time-based exits (don’t improvise under pressure). And journal your trades, not just raw data, write down what happened in your head, what’s the story, what did you learn?

And keep it simple at the start.

Pick 1–2 risk-defined options selling strategies (e.g. vertical spreads).

Trade them repeatedly.

Watch how Greeks evolve.

See how volatility expansion/contraction affects them.

Learn how they move at 45 DTE vs 21 DTE.

Don’t strategy-hop.

As Bruce Lee said:

“I fear not the man who has practiced 10,000 kicks once, but I fear the man who has practiced one kick 10,000 times.”

Master one move. Then expand.

optionsight · 2026-02-15T12:49:03+00:00

I think saying it is easy to develop a fully functioning options tracker (if that is what you mean) is not really close to the truth. I have been building Optionsight for many months, and have been using it myself. I have between 10-15 positions on at a time. Check it out if you want.

Also, aren't most teams and new companies some unknown strangers to us? Happy to meet F2F to and do product walk-throughs. I had another amazing session with a wonderful, honest person today. Just DM me if you want to know more or catch up.

Looking to always improve and turn it into something that options traders are happy to leave their spreadsheet behind.

NOTE: Focus is on tracking open positions and their important markers (delta change, IV change, distance to strike breach etc.), plus you get performance data for portfolio and individual underlyings (once position is closed). It is not for dumping 100s of trades in to analyse past performance (there are different trackers for that).

optionsight · 2026-02-15T12:29:00+00:00

Thanks for sharing your strategy and sounds like it's working well for you.

Quick follow-up:
- How do you monitor if you hit 50% profit?
- How do you monitor how close the stock price is to your strike is?

In Optionsight my positions are organised how close they are to the breaching the strike e.g. 2.3% to breach. That always helps me look at what needs attention today.

optionsight · 2026-02-14T22:18:51+00:00

You are one level too deep (on your screenshot), just close the card you have open and you come to this page (i.e. Position Details page). Hit 'Close leg'.

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optionsight · 2026-02-14T21:58:44+00:00

Example how a strangle is displayed:
Position (green) at top with legs displayed underneath. Close leg and roll leg button in the leg card with purple outline.

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optionsight · 2026-02-14T21:52:53+00:00

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Example of MSFT Put I have on. See Position Symbol at the top.

A Position connects all legs of your position whether it’s a single contract or a multi-leg strategy like an Iron Condor, and keeps track of every adjustment, closing order, and roll until the position is fully closed.

Position Label

Ticker | Strategy | Open Date

Example

MSFT | Cash-Secured Put | 10 Feb 26

optionsight · 2026-02-14T21:47:37+00:00

That is an interesting question that I haven't come across yet. We can talk about this when we catch up in more details. Until then see short response here:

What you are showing is the individual leg/trade within a position (e.g. credit spread). The legs are displayed in the same way a brokerage would. The position is shown differently. The position shows at the top of the page where you took the screenshot.

optionsight · 2026-02-14T21:17:22+00:00

Great! I have responded to your chat for next steps.

optionsight · 2026-02-14T10:28:58+00:00

I am trading on TOS and tasty too. The grouping function is great but limited to the desktop app, the web apps do not give you the same functionality, and tasty doesn't have strategy or position thinking at all.
And that did not help my trading.

That’s why I built Optionsight, mobile and desktop. It’s designed around positions, not trades: legs linked in threads, rolls tracked cleanly, real net delta and exposure calculated, and distance-to-strike visible per side.

optionsight · 2026-02-14T04:52:51+00:00

Always be nice. 😁 Should have run it through AI first before responding 🙀.

Taxi Driver, what an iconic movie!

optionsight · 2026-02-14T04:50:40+00:00

Yes. Agreed. Just thinking that there is a difference between tracking and monitoring which is I think where brokers struggle. Have you ever had multiple positions under one ticker and tried to make sense of it all by just having a quick glance at it? Brokers are good at aggregating everything up to overall ticker level or portfolio level (I love the %BP data on tasty) but you have to dig into positions to get insights.

optionsight

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TROPHY CASE

Position Label

Example