Thanks Challenger yes that helps and is what I am trying to do. I am using deviation levels to trade as well which are calculated off implied volatility of the futures contracts. Yet to see how that will work. I to thought that maybe options were in favor of the broker. I am trading on the exchange not a broker ( maybe the same thing) my risk is predefined and payout is 100% as well. In the short time since starting this thread I have come to understand that some of the trades I have taken are considered "lottery trades" and while risk is low the chance for an ITM payout is slim as well.
For me I guess the allure if you will is that I am looking to gain 10-15% weekly on my money. To do that in spot on say a 1K account I need 100 to 150 pips that would mean that I am looking to risk $1.00 per pip with an average stop loss of 30 pips I can be wrong 33 times in a row ( if that happens I should quit) . With the Binary option I can find a strike only a few pips away the risk is the same (or lower since on Nadex, Cantor and IG I can close it before expire). But the payout is higher IE.... in the picture screen shot I wasn't even a pip under and the trade paid out. I think profit on that trade was about $50.00.
So in low volatility or ranging markets where pips come hard an option seems easier since the distance needed is not the same.
If any of that sounds batty please let me know
So on to how do we price volatility?????
For me I guess the allure if you will is that I am looking to gain 10-15% weekly on my money. To do that in spot on say a 1K account I need 100 to 150 pips that would mean that I am looking to risk $1.00 per pip with an average stop loss of 30 pips I can be wrong 33 times in a row ( if that happens I should quit) . With the Binary option I can find a strike only a few pips away the risk is the same (or lower since on Nadex, Cantor and IG I can close it before expire). But the payout is higher IE.... in the picture screen shot I wasn't even a pip under and the trade paid out. I think profit on that trade was about $50.00.
So in low volatility or ranging markets where pips come hard an option seems easier since the distance needed is not the same.
If any of that sounds batty please let me know
So on to how do we price volatility?????