FnOLab

What it means

Time buffer is how many minutes theta alone needs to eat through your pain threshold (e.g. 15% of premium) — assuming the index does not move. It answers: how long do I have before time decay hits my stop?

How to use it (buyers)

• Green · Theta OK — buffer is ≥ 1.5× your typical hold. Room to hold for your plan.
• Amber · Tight — buffer is roughly your hold time. Theta can tag your pain threshold if the move is slow.
• Red · Avoid — buffer is below your hold time. Theta may stop you out before your thesis plays out.

What to avoid

Do not buy options with a red buffer when you need more time for the move. Expiry-day afternoon scalps often show tight buffers — that is the feature telling you the risk before you click buy.

Better strike selection

Scan ATM ± 2 strikes for green buffers that still match your delta target. Higher premium often buys more buffer; far OTM may look cheap but buffer shrinks fast on expiry week.