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Options Basics

Accounting for Option Time Decay
It is a common mistake of novice option traders to believe that if the stock goes up in price, then the options written on that stock will necessarily rise with it. While it is common for the two to rise and fall in tandem, this is not always the case.
Implied Volatility - Definition & Equation

The term implied volatility refers to an expectation of volatility in the underlying asset from the present till the options expiration, using current options pricing data as a basis

Option Greeks

Option greeks measure the options sensitivity to various risk components inherent to the price of an option. Delta, gamma, theta, vega, and rho measure the speed of the underlying securities price movement, interest rate movement, time decay of an option, and volatility.

Options Expiration Week

Options in one of four security classes will expire every month; stock options, index options, single stock futures, and stock index futures.

Options Risk Characteristics

A detailed explanation of the risk characteristics associated with a call option and a put option.

Put Call Parity
Puts and Calls

An option is one of the more advanced trading vehicles. Most investors focus on stock trading, but few know of the power that options provides to a trader, or investor.

Stock Options

Options allow the buyer and seller to hedge their risks or speculate on future moves in the underlying security. Learn about the basics of options at mysmp.com.

VIX - Volatility Index Definition & Trading Strategies

The VIX is an index used to track the volatility in the S&P 500, but analyzing the number of put and call options traded in real-time.

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