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Explain How Selling OTM Options Is Used as an Income Strategy

Selling the premium for high probability of expiration worthlessness, accepting limited profit for unlimited risk.
Greeks.Live04.11.25

Explain How Selling OTM Options Is Used as an Income Strategy.

Selling OTM options, also known as "writing" them, is an income strategy where the seller collects the premium upfront. The seller profits if the option expires worthless, which is the most likely outcome for OTM contracts.

This strategy involves accepting limited profit (the premium) in exchange for high probability of success, but it carries the risk of unlimited loss if the underlying crypto moves sharply against the position.

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