The Option Alpha Podcast 239: The Rise of 0DTE Options: Is It a Game-Changer for Traders?
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Dec 15, 2025 Dive into the world of 0DTE options, where rapid time decay and high liquidity offer unique trading opportunities. The surge in 0DTE volume is revolutionizing trader strategies, but it's not just a gamble. Discover the real benefits, such as faster statistical learning cycles and reduced exposure risk, while debunking myths about large accounts being necessary. Kirk emphasizes discipline, backtesting, and the importance of defined-risk spreads to navigate the emotional challenges of intraday trading. It's a game-changer, but execution is key!
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Zero DTE Is Here To Stay
- Zero DTE options are contracts that expire the same trading day and are becoming a dominant share of SPX volume.
- Kirk argues this shift is a lasting market change and traders should at least be aware of its impact.
Same Contract, Different Timeframe
- Zero DTE contracts are identical to other expirations except for time-to-expiry and resulting decay dynamics.
- A weekly or monthly contract simply becomes a zero DTE as it approaches its expiration day.
Liquidity Concentrates At Zero DTE
- Zero DTE volume on SPX has steadily grown until it represents over half of SPX option volume.
- That concentration means liquidity and market activity are increasingly compressed into same-day expirations.