Resources · Getting Started
Guide to investing with options
Once approaved for TIER 2 Level trading with your broker, onboarding, day-to-day usage, strategy patterns, and risk controls. Automation/tasks/config sections are intentionally excluded.
Getting started
Set up your default portfolio and account context, then run through one symbol-first strategy cycle in xStrategyBuilder before placing any live orders.
Accounts and holdings
Add brokerage accounts, verify positions (stock, options, cash), and confirm your default account has risk/outlook values so strategy scoring can use complete context.
First execution loop
Start with one underlying, define outlook, pick a strategy, then review expiration + strike + breakeven + payoff before making execution decisions.
Daily usage
Core app surfaces to monitor positions and evaluate new options opportunities.
Portfolio and watchlist
Use Portfolio and Watchlist to track symbol context, desk fields, and quote drift before deciding on new option structures.
xStrategyBuilder workflow
Use xStrategyBuilder for symbol selection, strategy fit, live payoff simulation, and contract exploration through the strategy options console.
xChat for rationale checks
Use xChat to stress test assumptions, scenario risk, and alternative structures. Keep prompts explicit about time horizon and assignment tolerance.
Secret Sauce (how responses are built)
Read Secret Sauce for the end-to-end flow: workspace context, SE scoring factors, collections search, web/x-search, and tool-loop synthesis.
Alerts and reviews
Treat scanner recommendations as decision support, not auto-execution. Re-check liquidity, spreads, and macro volatility before acting.
Strategies and scanners
A practical summary of legacy strategy docs oriented around income + defined risk.
Wheel strategy
Sell OTM cash-secured puts for income and potential discount entry. If assigned, sell OTM covered calls on acquired shares. If called away, rotate back to puts.
Deep dive: Building Wheel guide.
Covered calls
Use weekly/bi-weekly expirations and strike distance based on assignment appetite. Bi-weekly often balances premium capture with lower management overhead.
Protective structures
For downside control, evaluate protective puts or put spreads when volatility and event risk rise above your desk threshold.
Scanner interpretation
Scanner outputs are ranked suggestions. Validate with live chain quality (OI/volume/spread) and portfolio constraints before executing.
Options basics for execution
Keep the process systematic: entry context, strike distance, premium target, and exit rules.
- 80% rule: for sold premium, many desks buy back early around 80% captured premium to reduce tail-risk exposure.
- Strike discipline: choose strike distance from current spot and expected move, not solely by premium.
- Expiration selection: shorter DTE increases gamma risk; longer DTE increases capital lock-up. Match tenor to the thesis.
- Position sizing: cap notional risk per idea and enforce portfolio-level downside limits.
| Target annual | Bi-weekly per trade | Weekly per trade |
|---|---|---|
| 5% | 0.19% | 0.10% |
| 8% | 0.31% | 0.15% |
| 10% | 0.38% | 0.19% |
| 15% | 0.58% | 0.29% |
Risk and disclosures
Options can lose substantial value, including full premium paid for long options and significant losses in uncovered or poorly hedged structures.
- Use only risk capital and define max-loss before entry.
- Account for assignment/exercise paths and settlement obligations.
- Check spreads and liquidity; theoretical payoff can diverge from executable outcomes.
- Review OCC disclosures and your broker's options agreement before trading. Not financial advice.
Exclusions from legacy migration: automation workflows, scheduled task operations, and environment or configuration instructions.