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I don't want to discourage people from trading options, since I use them a lot and I think they are an excellent tool. But I think that ERD50 is speaking truth. The probabilities are priced in. Options do not constitute a free lunch. Things do mean-revert.
I want to point out to the novices who may be reading this post that you can lose your entire margin in a credit spread (or you can lose your entire investment in a debit spread, which is essentially the same thing as a credit spread--it's just a question of whether the money is tied up in the option or in your required cash margin). And if 1987 happens tomorrow, you *will* lose it all. You may argue that 1987 isn't going to happen tomorrow. Well, it probably isn't. But it will happen again, sometime.
So trade small, set some stops if that's your style, get out before expiration--essentially, establish some prudent entry and exit rules for yourself and follow them. Trade at a level where you would not be too adversely effected if 1987 did happen tomorrow.
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