Stock Option Trading Education
- Time Decay and Options: Stock options are a wasting asset. From the day you purchase them, their value goes down if the... read more
- 10 up Option Market Definition: Ten-up Option Market - Market Makers provide liquidity and they are members of the exchange. They... read more
- Strike or Exercise Price on Call Options: The strike price (exercise price) is the level at which the buyer of a call option can exercise... read more
- Option Bid/Ask Spreads and Liquidity: The Option Bid/Ask Spread is the difference between the stock option bid price and the ask price.... read more
- LEAP Options & Expiration Dates: LEAP stock options have more than six months until expiration. They can have a lifespan of up to... read more
- Option Ask Definition: An option ask is the price an option seller wants to receive for the option. If the option is... read more
- Four-way Options Spreads: A 4-Way Option Spread is the same as an iron condor spread. The option strategy sells an out of... read more
- Types of Option Spreads: An option spread is created when a trader simultaneously buys and sells options with different... read more
- Definition of Option Vega: An Option Vega measures the change in the price of a stock option relative to a 1% change in... read more
- Parity and Stock Options: Stock Option Parity means that the stock option is trading at its intrinsic value. If a $100 call... read more
- Derivatives & Underlying Stock Option Value: A derivative in the context of finance is a contract whose value is dependent on another... read more
- Option Expiration Month & Lifespan of Options: Options have a defined life and option traders select the duration that matches their forecast.... read more
- Time Premiums, Value and Volatility: A time premium is the amount by which the price of a stock option exceeds its intrinsic value. If... read more
- Options in the Money: A call option is where the strike price is lower than the current price of the stock is considered... read more
- Synthetic Put Position: Option traders often construct synthetic put positions to hedge their short stock positions. When... read more
