Stock Option Trading Education
- Synthetic Put Position: Option traders often construct synthetic put positions to hedge their short stock positions. When... read more
- Options and Time Value: The Time Value of an Option is the amount by which the price of a stock option exceeds its... read more
- When Options Trade at a Discount: An option that is trading below its intrinsic value is trading at a discount. For instance, a $50... read more
- Call Options & Naked Call Writing: A call option gives the buyer the right, but not the obligation, to buy the underlying stock or... 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
- 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
- Front Month Option Expiration: The nearest term stock option is referred to as the front month. In a four-week expiration cycle,... 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
- Option Premium Pricing and Intrinsive Values: An option premium is the price of the stock option. It is comprised of intrinsic value and time... read more
- Options At the Money: When the stock price is the same as the strike price an option is considered at the money. The... 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
- Parity and Stock Options: Stock Option Parity means that the stock option is trading at its intrinsic value. If a $100 call... read more
- Strategy for Synthetic Call Options: In a Synthetic Call Option, the investor can create a pseudo call position by buying puts that... read more
- Iron Condors: An iron condor is typically a non-directional option spread where the trader sells an out of the... read more
