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The daily erosion of an option's time value as expiration approaches. Premium sellers profit from theta decay — they want time to pass without large moves.
⚡ KEY TAKEAWAY: Theta accelerates after 21 DTE. Sell at 30–45 DTE, manage at 21 DTE to capture the steepest decay curve.
Delta
Sell at 0.15–0.30 delta for 70–85% probability of profit. Lower delta = safer but less premium.
Gamma
High gamma near expiration = your delta shifts fast on any move. Close or roll by 21 DTE to stay ahead of gamma risk.
Theta
Your daily paycheck as a premium seller. The closer to expiration, the faster it accrues — but gamma rises too, so don't get greedy.
Vega
Sell when vega is high (elevated IV) so you profit from both theta decay AND the eventual IV drop. Double tailwind.