My strategy invloves making profits by the increase in "Implied volatility" through long straddles/strangles.
Enemy: Time decay. I am aware that the time decay accelerates. I read, For a 9 month options contract, Time decay for first 3 months: 10%, 2nd three months: 30%, 3rd: 60%.
Friend: Implied volatility. Even though the longer contracts are costly, they are more sensitive to the Implied volatility as vega is higher. Buying underpriced options are most likely to give opportunity to sell when IV gets higher.
Slipage: Here is the problem. Even though if I can overcome theta by IV, there is this slipage I need to pay while both buying and selling. I am afraid, the more the market is illiquid, more slipage has to be paid. my concern here is, 1. How liquid the options market is? 2. What number of stocks in the world contain enough liquidity even in its long term (>=9 months) options contract?