In fact, most investors are still very unfamiliar with 50etf options trading, especially how to trade options and how to choose and trade option contracts. How to trade 50etf options? We start by trading our first 50ETF options contract.

The basic concept of how to trade 50ETF options

The buyer is bullish and buys the call option, and the bearish buyer is the put option

The seller is bullish and sells the put option, and the seller is bearish. Selling call options

Most investors initially thought that being a seller means buying put options. In fact, this is not the case. In options trading, there are options of buying and selling to open a position. Friends who are sellers must pay attention to the option of clicking SELL to open a position (as shown in the figure below). If the market outlook is bullish, sell the put option to open a position. If the market outlook is bearish, sell the call option to open a position. You are the counterparty to the buyer. .

How to choose a contract for 50etf options?

1. Selection of options contracts

The first is to choose contracts with large trading volume and high activity. Generally speaking, we always choose contracts with high activity and liquidity. To prevent liquidity risks that cannot be closed, contracts with good liquidity have at least two characteristics. Here, unpopular contracts with particularly low trading volume can be effectively eliminated.

One is that the bid-ask spread is narrow, and the other is that the number of quotes in the market is large and deep. Generally, the liquidity of a contract can be judged from its trading volume and open interest. Compiled from Baidu Option Sauce

2. Open deep out-of-the-money and real-value options carefully

Although the price of out-of-the-money contracts is very attractive, the risks are also very high. In most cases, When the time comes, the time value of out-of-the-money options will accelerate and decay as time goes by, and will return to zero when it expires. Even in most cases, the change in trend is favorable, but the profit and loss of out-of-the-money contracts has not reached a certain level. At the balance point, you will find that even if you are in the right direction, you have bought the wrong option contract. If you buy an out-of-value contract, you must be mentally prepared to lose all the premium.

As for deep real-valued contracts, not to mention they are expensive first, and their own leverage effect will not work. Real-valued options have intrinsic value and time value, and the time value accounts for a relatively small proportion. The harm to buyers is relatively low, and real-valued options actually have a greater synchronization rate with the fluctuations in the underlying. Therefore, as long as the underlying fluctuates, real-valued options can generate income.

But if the trend changes in an unfavorable direction, the investor's loss will be very large. The real-valued option purchased not only needs to pay the time value, but also needs to pay a large amount of intrinsic value to the seller, which is equal to You paid the seller for an additional policy. After all, your loss is the seller’s profit.

When trading options, you will find that the more active contracts are generally at-the-money options. The premium cost of at-the-money options is moderate, the leverage ratio is moderate, the time value of at-the-money options is the largest, and the loss rate from the time value is It is also relatively large from a perspective, but at-the-money options are most likely to become real values. Therefore, when the underlying price effectively breaks through the at-the-money exercise price, at-the-money options can bring the greatest profit. Of course, if there is a wrong direction, the losses will naturally be greater.

3. Analyze the subject of the contract

Trade according to the rising or falling direction of the underlying 50ETF index. If the price of the underlying security of the contract is bullish, you can buy a call option. If the price of the underlying security of the contract is bearish, then you can Put options can be purchased.

The trend of SSE 50 ETF options often fluctuates with the ups and downs of the broader market, while the financial market affects the trends of the broader market. For example, large-scale news will cause the stock market to fluctuate, thereby driving changes in SSE 50 ETF options.

4. Pay attention to changes in volatility

The underlying price of the contract, time, volatility, exercise price, risk-free interest rate and dividend rate all affect the option price. reason. The biggest impact is time and volatility, which are very important. Option investment is not a pure directional investment product but a time-consuming product. Its impact is the most direct. If other conditions remain unchanged, the shorter the expiration date, the less the value will be, to zero. Out-of-the-money contracts have low premiums, high leverage and high investment risks.

Investors who understand options all know the volatility index, but most people only know it and are not clear about its role. Volatility is a quantity that cannot be measured! It is also an important factor in how to make options.

5. Consider more the elapse of holding time of option contracts

In addition, in options trading, investors should pay attention to the issue of how long the contract has until the expiration date. Attention is drawn to the fact that time is very important for option investors, so what impact does time have on the contract in option investment?

As the expiration date is approaching, due to the accelerated decay of time value, if At this time, the fluctuation of the target is not large enough, and the consumption of time value will affect the price of the option.

Especially as the expiration date of the contract is approaching, the value decays faster and there is not much value left. The seller has little profit and can choose to consider next month, because the fluctuation at this time is very important. The scope of influence of option prices will be very large, with greater risks and opportunities. However, at present, according to market dynamics or investors may consider purchasing out-of-value contracts, often at this time, the market may experience large changes in speed and amplitude.

It is a very important process in the actual operation of options and requires a lot of practice and gradual experience. Investors must get used to using position management and capital turnover to control risks. You can also try the strategy alone first, so that the profits and losses are limited, and you can make adjustments at any time according to market development and the emergence of opportunities. This way, investors can maximize their capital and leverage levels to earn returns.