Stock Option Trading Education
- Option Ask Definition: An option ask is the price an option seller wants to receive for the option. If the option is... 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
- 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
- Front Month Option Expiration: The nearest term stock option is referred to as the front month. In a four-week expiration cycle,... read more
- Diagonal Option Spread: A Diagonal Spread is an option spread where the trader buys a longer-term option and sells a... read more
- Option Trading for Investment, Speculation and Hedging: Option trading involves investors and speculators buying and selling stock options before they... 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 Theta: An Option Theta measures the rate of decline in a stock option due to the passage of time. Theta... read more
- Married Puts Options Strategy: In a married puts option strategy, the investor owns shares of stock and purchases an equal number... read more
- Put Option & Equity Puts: A put option gives the buyer the right, but not the obligation, to sell the underlying stock or... read more
- Option Bid Definition: An option bid is the price an option buyer is willing to pay for the option. If the stock option... read more
- Time Decay and Options: Stock options are a wasting asset. From the day you purchase them, their value goes down if the... 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
- Intrinsic Value and Option Trading: For in-the-money call options, intrinsic value is the difference between the stock price and the... read more
- Synthetic Put Position: Option traders often construct synthetic put positions to hedge their short stock positions. When... read more
