The Essence of Zero Days to Expiration Options

Zero days to expiration (0DTE) play a crucial role in the intricate tapestry of the stock market. How can one seize the opportunity, and what aspects merit attention?

0DTE are typically more prevalent in the U.S. stock market, mainly because they are weekly options. Conversely, in the Hong Kong stock market, monthly options are more common. By conventional standards, options that expire within a week are deemed "zero days to expiration" options.

How to seize the opportunity typically revolves around two key points:

1) Performance: This aspect requires no elaborate explanation; it involves assessing the impact of performance on stock prices. Some may argue against relying on fundamental analysis, but this is a fallacy. Before making any investment decisions, analyzing past financial reports is imperative.

Take $Nike(NKE.US)$ , for example; the previous quarter clearly indicated potential profit downturns and associated pressures. Moreover, the recent incidents involving $LI NING(02331.HK)$ and $ANTA SPORTS(02020.HK)$ underscore a significant revenue shortfall. When stock prices deviate from fundamental aspects, it's a clear indication to "put"!

When buying, emphasis should be placed on the investment amount. I typically calculate whether the current price dropping by 5% would be suitable for entry.

Secondly, sudden news events, exemplified by $TENCENT(00700.HK)$ :

- National Press and Publication Administration: "Online games must not set inducement rewards such as daily logins, first-time top-ups, consecutive top-ups," etc.
As someone immersed in daily work routines, I may not immediately notice such news. However, when my phone alerts me to Tencent's stock dropping by over 5%, I take notice.