For premium selling strategies, we can find the max return on capital (ROC) by dividing the initial credit by the buying power requirement (BPR).
Companies look at ROC to assess the efficiency in allocating capital to potentially profitable investments. The higher the potential ROC, the more likely a company is to invest in an opportunity.
What if we applied this strategy to options trading? Is there some threshold for ROC that makes trades seem more attractive?
Join Tom and Tony to find out!
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