The "daily Call" From Option Alpha: Options Trading | Stock Options | Stock Trading | Trading Online

#167 - Are Index Options More Profitable or Stock Options?

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Synopsis

Hey everyone, Kirk here again and welcome back to the daily call. Today, I want to answer a question that somebody submitted which was, “Are index options more profitable or are stock options more profitable?” The simple answer to this is – Neither is more profitable than the other. There's no definable difference between trading index options and trading stock options one, in and of itself. Just using an underlying product is not more profitable than the other. It always comes down to strategy and the way that you either buy or sell options and the way you manage your portfolio. I think the only real big difference between these two is that index options just carry a lot more value and weight, meaning you should trade them more with higher denomination accounts, so larger accounts, find that it's easy to start trading index options because they have a higher contract value, you don't have to sell as many contracts or buy as many contracts as opposed to regular traditional stock options on a stock or ETF whic