Trade Logic Unlocked

Theta as a Risk Proxy

Trade Logic Unlocked

Options involve risk and are not suitable for all investors. Please read Characteristics and Risks of Standardized Options before deciding to invest in options.

A core piece of our trading philosophy is positive theta. It is possible, however, to have too much positive theta on in your portfolio, as the amount of theta you carry in your portfolio is directly tied to the amount of risk you are exposed to in your portfolio. So today, we offer some general guidelines for portfolio theta levels to consider, based on account size and market volatility.

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