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My guess is, since these are cash settled and cannot be exercised early, theoretically front month could lose money much more heavily than the long month. In american style options that risk does not arise because the ability to early exercise keeps arb between the front and long month under control. Not sure how IB manages this risk. I am sure if the short front leg starts getting really out of whack from the long, they'll jack up the margin.

I'm sorry if it came across that I was saying that taking profits at some % of max value was "invented" by TT. Of course it was not. I was just saying that this is something I should have been more focused on..on my own, all along, and it was just coincidence, i guess, that it happpened to be TT who made me think more about it. The idea of "defining your profits" is as old as trading itself. TT did not invent it. But , wherever I may have gotten it into my head from, and was the cause for improved profits, has been helpful to me. I know that you do the same, or similar thing as well. All good traders do some variation of this. It just turned out that I happened to get the idea shoved into my face by them, only because I had been listening to them for a few years. I only started with you just recently. But, it could have been the other way around. It's just the way it happened to work out. And you are VERY right about all of the people, most definitely the majority of more novice traders, who , since they are coming into this not knowing much, ARE very vulnerable to believing all of the BS from TT because of the "appearance" that they present. A lot of that is a function of it also being a "trading entertainment" show! But, both you and I, can easily present a long list of all of the stuff that they are saying that is pure nonsense. And I bet our lists would be identical. We all know, on balance, as a seller of premium, you have more things working in your favor than a net buyer. But, anyone who makes an "Absolute" committment to NEVER be long premium is out of their minds. There is probably a lot of "ego" involved in that. They have "drawn their line in the sand" and now they have to stick by it! Even though I am probably short premium 80% of the time....I am sure that I have made more money the 20% of the time that I found the right moments to be long premium and had the value of "leverage" working for me. But, that is a dangerous thing because, over the long run, being long premium will be a loser if it is all you do. After making an outsized return from the leverage of being long premium, and having it work, it is too easy for many people to fall into the trap of getting "addicted" to it. And that is where they will start to go downhill. It took a long time but, I understand what generally is the right balance and being long premium , for me, despite the gains, is still the exception, never the rule.

I just want to add, or reiterate, that IF you are able to distill the 10% of BS that he is saying from the 90% of valuable information, it can be extremely helpful. I will just point out 1 tidbit that I really should have known, and practiced, on my own, which because of the way it kept getting presented by TT, has increased my profitability in a very big way....and it is so damn simple. It is the practice of locking in profits at some % of the the maximum value of the premium collected if held until expiration. Even though they make such a fuss over the fact that they ONLY sell options, which , on it's face, is just a stupid mindset to get locked into....this will be helpful whether you are short, or long premium, in a defined risk (spread) context. You sell something for $2.00 If you wait until expiration, and live through all of the ever increasing risks of rising gamma that happens in the final days, the most you will make is $2.00. The concept of taking profits at some % of full value has increased my profits, and reduced a high % of potential losers for me at least. And, it makes good sense, just on it's face. You sell a spread for $2.00 with 45 days to go, and after 3 weeks you can buy it back for .70 cents just before the period of rising gamma begins. This should be a no-brainer. They focus on 50% of maximum profits but, it can be any pre-defined amount...and it gives more "discipline" to the trade. It will work the other way too. If you are a "buyer" of a spread. Because, in both cases, there is a pre-known, maximum value of the profit that can be achieved, you can take profits at your OWN defined % of that maximum profit. In the end it is no different than simply having an exit plan and taking profits before you might end up giving all or some of them back. Just take from TT what YOU feel is the reasonable, valuable, info and ideas, and make into something that is your own. And discard the BS....you know the difference between the two!

I couldnt help myself and had to start that twitter exchange...hopefully it lands you on the show @SteadyOptions!!

It is a complicated area. I understand their apparatus because I am basically a mirror of them, in terms of our respective histories. Both Tom and I got our first seat on the floor in 1980 and lived through the evolution of many different era's in the world of trading. We both got "hip" to options in the days when there were no "exchange traded" options and were among the first to trade them and posted our "flags" on the (options) "moon" from the beginning. All of the retail traders today, have not lived through that evolution. They just walk in the door and get the benefit of an enormous amount of knowledge and experience right up front. I think I can benefit from Tom more easily than others because I understand where he is coming from. Both, in terms of the history of the knowledge, and how, the "pioneers" uncovered, all on our own, what everyone gets to enjoy today, in the electronic age. I also understand his need to be a TV host with "schtick" to attract viewers commercially for what is basically "part" entertainment. He definitely is NOT all black or all white. But, it takes a certain, experienced, objective mind,and perspective to be able to cipher the BS and entertainment, from the solid research and , mostly, good information. But, for beginners, who do not know any better, yes, it can be dangerous stuff, if one cannot separate the inflated ego, and "our way is the only way"..from the good stuff. And there really is a LOT of good stuff. But, you must enter at your own risk and be able to know the difference from "value" and "BS". I wish to God I had his data base and team of analysts available to ME. I would use all of that valuable info and talent in a very different way. I would use it to search for new ideas, rather than validate "my way" based upon "ego". He REALLY does have all the tools to present a fabulous source of learning and research. But, I feel he is up against satisfying competing interests being in the position he is in...plus , his ego does get in the way.