Neerav Bafna is a full-time investor and an options writer, he uses options as a tool to hedge his investments and gain his dividend. Capital protection is both his obsession and brilliance. In his blog he writes about Finance, markets and life, his witty lines give readers a light of confidence to stay in the game. He is mostly active on Instagram and conveys information to the audience in the form of infographics - he believes less is more and people pay more attention to things when conveyed via graphics. His page Evergrow Invesco has a base of over 6500+ readers and audience. He believes that the stock market is a place where it is very hard to make ‘easy money,’ hence he's carrying out both the convention-style of investing and trading options for the comfort of hedging his portfolio.

Theta measures the rate at which an option losses its value over a passage of time. While theta can be a brilliant idea for option writers, it can be used to draw inspiration for value investing as well. Value investing is ferrying out stocks that you think the market is underestimating, while theta in simple language means time, the more time you give the better results you get, while time is the most quintessential part of making money in the financial markets the term "theta" is often referred only to options.

Here are a few lessons which investors can gain from theta (an option geek) :

Time is Money - when it comes to investing or selling options, the re-investment in time can be such a charming friend. If you don't have the patience to hold, you better not be able to think about making the honey. If you hold both the options and investments (as long as the business is performing) to the infinity, the MTM will be positive.

Volatility is fugacious - a flower falls after it blooms, same is the case with volatility. But volatility is impermanent and has its root to the rules of gravity - what goes up, has to come down. As we refer "nothing lasts forever" - while volatility can help you grasp trading opportunities in the market, it can create a subtle disaster in the mind of a retail investor. When volatility increases the movement in both options and underlying (investments) move drastically.

Associated behaviour - theta has a property expressing its behaviour with respect to the addition of a period, of the associated behaviour of the underlying stock. In simple terms, a theta can only not make money when the properties of the underlying have changed, like in case of investments - you cannot make money even over infinity years if the properties (performance of the business) of the underlying is offset by its route. Theta as a subject is correlated to its underlying with respect to time. In options, as long as you are in the fair market conditions, you cannot go wrong with making money with theta's formula. In investments, if the business is underperforming theta cannot be blamed for spoiling the party.

Maturity - the decay value of premiums is more as options come nearer to the expiry. In investments, the initial years may not give you expected returns but as the business matures the rate at which stock prices move up is tremendous. In both cases, when it comes to maturity - you can reap the benefits.

Acknowledge the business - in times of volatile markets like in COVID-19, you have to distress yourself with the fear of missing out. Options are a contingent liability, you are liable to a claim only when the criteria is met if the underlying is not able to reach the strike price how much ever it moves and increases the fear of losing more money in the situation, be grounded and do not lose your feet. The same goes with investments; do not quit investments based on tank or surge in prices. Quit it when you think the business hasn't met the criteria to hold longer, consider every fall to be your friend. As Warren Buffet said: be greedy when everyone is fearing and be fearing when everyone else is greedy.