Since options depreciate in value over time, is it better to buy a nearby option or a longer dated option?
The closer an option is to expiration, the less time you will have to be right about the direction and magnitude of a stock’s move and the more rapid the price decay. The decision as to what expiration month to use will vary according to your expectations for the stock. Generally, the more time you buy, the more room for error. The flip side of that is that you generally get less leverage, since the longer term option costs more than a shorter term option.
