Most options trading tips are true and useless: “understand the Greeks,” “manage risk,” “have a plan.” The problem is not knowing them. It is that nothing tells you, three months later, whether you actually followed them — or whether they made you money.
So every tip below comes with the thing you would log to check it. Eight rules, including how weekly options change the picture. None of them is a prediction about where any stock is going.
New to the instrument? The Options Institute at Cboe covers the basics. Options-specific logging lives in the options trading journal.
1. Check implied volatility before you pick a side
Implied volatility (IV) is the market’s price for expected movement. When IV is high, options are expensive; when it is low, they are cheap. Buying options when IV is elevated means you need a bigger move just to break even, and you can be right on direction and still lose as IV falls. Investopedia on implied volatility has the definition.
Rule: buyers prefer lower IV, sellers prefer higher IV — relative to that stock’s own history, not to other stocks.
Log: IV or IV rank at entry. After 30 trades, split results by high vs low IV entries. It is one of the quickest ways to find out you have been overpaying.
2. Use the Greeks you will act on
You do not need all five. Most traders act on three:
- Delta — how much the option moves per $1 in the stock, and a rough proxy for the chance of finishing in the money.
- Theta — how much value the option loses per day. Your friend as a seller, your rent as a buyer.
- Vega — sensitivity to changes in IV. Why long options lose money after earnings even when the stock moves your way.
Log: delta at entry for every leg you sell or buy. “I sell 30-delta puts” is a rule you can check. “I sell puts that look safe” is not.
3. Size by maximum loss, not by number of contracts
Ten contracts of a $0.50 option and one contract of a $5 option are the same dollar risk. Contract count says nothing. Size every trade by what you lose if you are completely wrong, and keep that at a fixed share of the account — many traders use 1–2%.
Log: max loss in dollars and as R. If your biggest losses are 3R and 4R, the problem is sizing or exits, not strategy. The position size calculator does the arithmetic; risk management for traders covers the rest.
4. Prefer defined-risk spreads while you learn
A spread buys back part of the risk you sell. A bull put spread caps the loss of a short put; a debit spread caps the cost of a long call. You give up some return for a loss you know before entry.
Log: strategy type as its own tag (BPS, CALL-DEBIT, IC), plus width and credit or debit. The bull put spread examples show the full math, including the win rate each spread needs to break even.
5. Write the exit before the entry
Options have three exits, and you need all three decided before the order goes in:
- Profit target — for example, close a credit spread at 50% of max profit.
- Loss exit — a multiple of the credit, a debit percentage, or a level in the stock.
- Time exit — close or roll before the last week, when gamma makes prices jumpy.
Log: the planned exits and the actual exit reason. A rising share of “held to expiration” or “closed manually” usually means the plan is being ignored. More in profit taking strategies.
6. Treat weekly options as a separate strategy
Weekly options expire within days, so they are cheaper and decay faster. That cuts both ways.
- Theta is faster. Sellers collect decay quickly; buyers lose it quickly.
- Gamma is higher. Near expiration, small moves in the stock swing option prices hard. A spread that looks safe on Wednesday can be in trouble by Friday afternoon.
- Events matter more. An earnings report, CPI print or Fed decision inside a weekly’s life is a large share of its remaining time.
- Liquidity varies. Index ETF weeklies (SPY, QQQ) trade heavily; many single-stock weeklies have wide bid-ask spreads.
Common weekly approaches are short-dated credit spreads on indexes, defined-risk earnings plays, and small directional debit spreads. All of them need smaller size than the monthly version of the same trade.
Log: tag weeklies separately (WEEKLY-BPS, not BPS). Compare their win rate, average loss and expectancy with your monthly trades. Many traders find weeklies win more often and lose more per loss — only the journal shows whether the net is positive.
7. Pay attention to liquidity and fills
The bid-ask spread is a cost you pay on entry and again on exit. On a thin option, it can be larger than your expected edge. Use limit orders, start near the mid-price, and avoid strikes nobody trades.
Log: fill price vs mid-price at entry. Summed over a year, slippage on illiquid options is often bigger than commissions.
8. Review results per strategy, not per account
A blended options P&L hides everything useful. Group trades by tag and look at each one:
- Win rate vs the break-even win rate the structure needs
- Average win and average loss in R
- Expectancy per trade
- Plan-followed rate
Wait for roughly 30 trades in a tag before deciding anything. Then make one decision: keep, adjust or pause that strategy. The metrics are explained in how to calculate win rate; the columns are in the options trading journal template.
The eight tips and what to log
| Tip | What to log |
|---|---|
| Check IV first | IV or IV rank at entry |
| Use the Greeks you act on | Delta per leg at entry |
| Size by max loss | Max loss in $ and R |
| Defined-risk spreads | Strategy tag, width, credit/debit |
| Exit before entry | Planned exits, actual exit reason |
| Weeklies are separate | Separate tag per expiration type |
| Liquidity and fills | Fill vs mid-price |
| Review per strategy | Win rate, avg win/loss, expectancy per tag |
Frequently Asked Questions
What is the most important options trading tip?
Size by maximum loss. Every other tip assumes you survive long enough to learn from your results, and oversized options trades are the fastest way not to.
Are weekly options good for beginners?
They are harder to manage, not easier. Fast decay and high gamma near expiration leave little time to correct mistakes. Learn with monthly expirations and small size, then add weeklies as a separately tracked strategy.
What is a good weekly options trading strategy?
Defined-risk structures — credit spreads or small debit spreads — on liquid underlyings, sized smaller than monthly trades, with exits decided before entry. Whether it is “good” for you shows up only after you track a sample of them.
How much money do I need to trade options?
Enough that a single maximum loss stays around 1–2% of the account. Spreads make that possible with smaller accounts because the loss is capped.
Should I journal every options leg?
Yes. Record each leg’s strike, expiration, price and delta, plus the strategy tag for the combined position. Multi-leg trades are where memory is least reliable.
Bottom line
The options trading tips worth keeping are the ones you can check: IV at entry, delta per leg, max loss in R, exits decided in advance, weeklies tagged separately, fills against the mid. Log them, review per strategy after a real sample, and change one thing at a time.
When you want those numbers per strategy without building the spreadsheet, open the journal and log your next options trade.
Options involve risk and are not suitable for all investors. This article is for education, not investment advice.