The key to managing risk in options while trading them in place of stocks is to roll them over when you have nice profits and would like to stay in a trending stock. If you buy a SPY ETF call option contract with a $200 strike price for $300 when SPY is trading at $203 and the ETF runs quickly to $206 and your option increases to being worth $600 then it is important to lock in those profits and roll it to a new call option. Buying a $203 strike call option for $300 will allow you to lock in your original $300 profit for a 100% return on that option trade. This way $300 of your profits have been banked and removed from the table. Even in a nasty whip saw against you of $3 in the underlying ETF price you can not lose that original $300 in risk capital only the $300 in profit. This is an important strategy to understand especially late in a stocks run when a reversal could be eminent.
It is also important to understand that the options need to be highly liquid so you do not lose an excessive amount of capital with a wide bid/ask spread in trading and rolling these options actively. This rolling works with both weekly and monthly options if you are holding over the long run. You can both lock in your winning profits and at the same time roll your option to allow your winner to run in a trending stock or market by moving the strike price of your option in the direction of the trend expiration date farther into the future. This enables the option holder to trade the same directional position over the long term and at the same time capture maximum delta with weekly options or front month options. This is another strategy to add to your arsenal that helps limit the downside but keeps your upside unlimited. The key is to buy an in-the-money option and if it goes deep in-the-money sell it and buy a new at the money option while locking in your profits but letting your winner run with a new option with less capital at risk.
Rolling option contracts up and forward is a tool for capturing trending markets. The goal is to keep your capital at risk exposure within set parameters and to lock in profits while they are there. With the in-the-money options Delta is always high but the amount of intrinsic value your option builds is what is exposed to whip saw reversals and trend reversals. You want those profits safely in your account not inside an option contract that is giving your little edge with this risk of open profit exposed to loss. The best time to lock in these open profits is into strength and then reenter the trade with the next pullback if possible. you can set a time limit that if there is no pullback you enter back into the trend. This will help you not risk missing out on a strong trend, but it is rare that there will not be a pullback to let you get back in. This process is similar to trend following with managed futures where they have to roll futures contracts as the delivery day approaches. I do not hold my winning option trades until expiration I take the profits off the table when they are there whenever that falls in the life of the option contract.