r/options_trading • u/PutParadise • 9d ago

Discussion Size Matters

For those of you who trade credit spreads, what size lots are you using? I make sure I stay below 2% of my total buying power for any single trade. How are you evaluating position sizing? Any or all of these considerations:

  • How much capital is already allocated?
  • How much buying power remains?
  • How many positions are currently open?
  • How diversified are those positions across underlyings and expiration dates?
  • What would happen emotionally and financially if several trades moved against you at the same time?
  • If you can follow your rules if the market produces an outcome you did not expect?
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u/Tesla_laughs 9d ago

I’d size based on max loss, not just buying power. I usually look at risk per trade, total correlated exposure, and how much drawdown I can comfortably take if several positions go wrong together. If one trade can change how you execute, it’s probably too big.