Kardec Trader explains sizing options trades for a maximum acceptable loss before entering. Use a fixed dollar amount like $1,000 instead of percentage stops, and expect intraday swings of 50-60% on weekly or zero-DTE options without panic selling.
You need to look at the news and data, understand the levels. Size for zero. This is for options trading. The point of doing this size for zero. You're looking at your max risk first when you enter. You're never caught off guard by a red piano. For me, I trade weekly options. They have the highest volatility and sometimes it's zero DTE sizing for zero. It's going to put you in a position where you're ready for max gain and max loss. When you have that mindset with trading, it's going to put you in a position where you're always going to be in control. So let's say it's a $5,000 position, right? So most traders will be like, okay, I'm going to do a 20% stop loss. When it get down to $4,000, they'll be like, okay, stop out, stop loss. But for me, I'll just buy $1,000 worth. This will be my position. So instead of like having like a 20% stop, because 20% is also very tight for options, doing it this way, a thousand as your max risk, you can hold those for like 5x to 10x and, like, it won't bother you. It's really important for options because you can see option go down like 60% one day and the next day comes back and it runs like 3, 400. There's nothing more frustrating than seeing that.
