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How do ITM and OTM options differ in terms of profitability for cryptocurrency traders?

avatarsumih pdlNov 29, 2021 · 3 years ago3 answers

What are the differences in profitability for cryptocurrency traders between ITM (in-the-money) options and OTM (out-of-the-money) options?

How do ITM and OTM options differ in terms of profitability for cryptocurrency traders?

3 answers

  • avatarNov 29, 2021 · 3 years ago
    In terms of profitability, ITM options are generally more profitable for cryptocurrency traders compared to OTM options. This is because ITM options have a higher intrinsic value, which means they are closer to being in-the-money and have a higher chance of being profitable at expiration. On the other hand, OTM options have a lower intrinsic value and are further away from being in-the-money, making them less likely to be profitable. However, it's important to note that the profitability of options trading also depends on other factors such as market conditions and the trader's strategy.
  • avatarNov 29, 2021 · 3 years ago
    When it comes to profitability for cryptocurrency traders, ITM options have the upper hand over OTM options. ITM options have a higher chance of being profitable because they are already in-the-money or close to being in-the-money. On the other hand, OTM options are out-of-the-money and have a lower chance of being profitable. So, if you're looking to maximize your profitability as a cryptocurrency trader, it's generally recommended to focus on ITM options.
  • avatarNov 29, 2021 · 3 years ago
    As a cryptocurrency trader, you may be wondering which options, ITM or OTM, are more profitable. Well, the answer is that ITM options tend to be more profitable compared to OTM options. This is because ITM options have a higher intrinsic value, which means they have a higher chance of being profitable at expiration. On the other hand, OTM options have a lower intrinsic value and are further away from being in-the-money, making them less likely to be profitable. So, if you're looking to increase your profitability in cryptocurrency trading, it's advisable to consider ITM options.