‘Moneyness’ considers the strike price of an option versus the current stock price. If exercising the option produces a ‘better’ result than if the option holder traded in the…
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Investing
Options Spreads Combinations Explained For example a trader may sell one AAPL 170 call and buy one AAPL 160 call, a type of call spread as defined below. In…
It’s important to know what these terms mean. In addition, you should know under what circumstances you should buy to open and when you should buy to close. (We have…
(We have similar post on the opposite trade: Buy To Open vs Buy To Close) What Is Sell to Open In Options Trading? An open position means that you’re…
The answer is the Synthetic Covered Call. What Is A Synthetic Option Strategy? A synthetic covered call is an options position equivalent to the covered call strategy (sold call options over an…
In this case, what is being mimicked is a long position on a stock by selling a put and buying a call at the same strike price and expiry (usually at the…
This article was written by Chris Young and was first published on Epsilon Options (now part of SteadyOptions). The Options: Greek Vega Explained Investing in options is always challenging…
This article was written by Chris Young and was first published on Epsilon Options (now part of SteadyOptions). Below we’ll build up this payoff diagram – for both long and…
We’ll also provide some tips on how to pick the right strategy for your trading goals and risk tolerance. So whether you’re looking to make a quick profit or hedge your portfolio…
Here’s our guide to this phenomenon and its uses in options trading… Implied Volatility Skewness Background Implied volatility (IV) describes the market’s expected volatility ‘implied’ by its price. Five…