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Options trading has a reputation problem. Mention that you’re interested in learning it, and there’s a good chance someone will tell you you’re not investing at all, you’re gambling.
One person recently took that question to Reddit’s r/optionstrading. They had heard the warnings but wondered whether the real problem was short-dated options. Would buying contracts with more time until expiration make options less like betting? The downside, they noticed, is that “premium prices shoot up” with longer-dated options.
It’s Not Just About How Much Time You Buy
The responses largely pushed back on the idea that days to expiration, or DTE, determine whether an options trade is a gamble.
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One trader described options as a “sliding scale,” ranging from buying one-day-to-expiration contracts shortly before the market closes, which they called a “complete gamble,” to buying deep-in-the-money long-date call or put options on stocks you believe will perform well over a year or longer.
Another commenter drew the line somewhere else entirely.
“Options aren’t gambling just because they’re options,” they wrote. “They become gambling when you’re taking trades without a repeatable setup, defined risk, and an actual edge.”
That focus on having a repeatable strategy also makes trading costs worth considering. Since its inception in 2019, Public has offered new ways to help people grow their wealth, and its approach to options includes helping traders maximize their moves while minimizing costs. Public is the only broker that pays rebates on options trades, offering $0.06-$0.18 per stock or ETF options contract traded, along with industry-low index fees starting at $0.35 and margin rates as low as 3.95%.
Short DTE can certainly magnify mistakes. With little time remaining, an option can lose value quickly if the underlying stock doesn’t move as expected. But simply paying more for additional time doesn’t transform a poorly thought-out trade into an investment.
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One of the clearest responses argued that the real question is whether you have a thesis about the underlying investment.
