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Tag: options

Tag: options

29 pages tagged options.

Pages

  • Part One: What You Need to Know First — Understanding Options 2E

    Overview of Part One of Understanding Options 2E — the foundational section covering what options are, how accounts work, and the core vocabulary every options trader needs.

  • What You Need to Know First — Understanding Options 2E

    Introduction to the foundational concepts covered in Part One of Understanding Options 2E — the prerequisite vocabulary and account knowledge before any strategy is attempted.

  • Welcome to the Options Market — Understanding Options 2E

    What options are, why they were invented, and the four primary reasons individual investors use them: income, protection, hedging, and speculation.

  • How to Open an Options Account — Understanding Options 2E

    The five steps to opening an options account, what the brokerage approval levels mean, and why the options agreement determines which strategies you can use.

  • Chapter 5: The Fascinating Characteristics of Options — Understanding Options 2E

    The vocabulary of options — contracts, underlying stock, expiration, premium, calls vs puts, strike price, intrinsic vs time value, and LEAPS.

  • Chapter 6: The Joy of Selling (Writing) Covered Calls — Understanding Options 2E

    Selling covered calls — rent your stock for premium income while keeping ownership and dividends, with controlled, capped upside.

  • Chapter 7: How to Choose the Right Covered Call — Understanding Options 2E

    A framework for picking covered calls — start with the right underlying stock, then weigh market conditions, strike price, premium, and expiration.

  • Chapter 8: Step-by-Step Selling Covered Calls — Understanding Options 2E

    The mechanics of actually placing a covered call order — risks, the option chain, sell-to-open, quantity, and limit vs market orders.

  • Chapter 9: Managing Your Covered Call Position — Understanding Options 2E

    Three possible outcomes after you sell a covered call, plus rolling, buying back, and the buy-write strategy for active management.

  • Chapter 10: Assignment — Your Obligation to Sell — Understanding Options 2E

    How exercise and assignment work — why it is mostly automatic, almost always happens at expiration, and is a good outcome for the covered call seller.

  • Chapter 11: How to Choose the Right Call Option — Understanding Options 2E

    How to evaluate strike prices, intrinsic value, and probability when buying a call — and why the cheapest option is rarely the right one.

  • Chapter 12: Volatility and Options Pricing — Understanding Options 2E

    How premium decomposes into intrinsic value and time value, and why implied volatility is the hidden engine that can sink a directionally correct trade.

  • Chapter 13: Step-by-Step — Buying Calls — Understanding Options 2E

    The mechanics of buying a call option: risks, the bid-ask spread, order types, and a walk-through of placing the trade on a brokerage platform.

  • Chapter 14: Managing Your Call Position — Understanding Options 2E

    The three outcomes after buying a call — up, flat, down — and the discipline of taking profits early and cutting losses before time decay erases them.

  • Chapter 15: Exercise — Your Right to Buy — Understanding Options 2E

    The four choices a call owner has at expiration, why most traders sell rather than exercise, and the automatic-exercise rule that catches forgetful buyers off guard.

  • Chapter 16: How to Choose the Right Put Option — Understanding Options 2E

    Why puts deserve a place in every options trader’s toolkit — the two reasons to buy them, moneyness for puts, and selection criteria for bearish speculation or portfolio insurance.

  • Chapter 17: Managing Your Put Position — Understanding Options 2E

    How to manage a speculative long put: outcomes when the stock rises, falls, or stays flat, plus exit discipline, profit targets, and exercise mechanics.

  • Chapter 18: Protective and Married Puts — Understanding Options 2E

    Using puts as portfolio insurance: protective puts on stock you own, married puts opened simultaneously, ETF puts for whole-portfolio hedging.

  • Chapter 19: The Collar — Understanding Options 2E

    Combine a covered call with a protective put to create a collar — capping both upside and downside, often at zero net cost, for capital-preservation investors.

  • Chapter 20: Credit and Debit Spreads — Understanding Options 2E

    Vertical option spreads explained: bull put, bull call, bear call, bear put — how credit and debit spreads define your maximum profit and loss in advance.

  • Chapter 21: Buying Straddles and Strangles — Understanding Options 2E

    Volatility strategies for when you expect a big move but not its direction. The mechanics of long straddles and strangles, and why most traders lose on them.

  • Chapter 22: Selling Cash-Secured and Naked Puts — Understanding Options 2E

    Sell puts to either collect premium or buy a stock you want at a discount. The mechanics, the win-either-way logic, and the catastrophic-tail risk of selling naked.

  • Chapter 23: Delta and the Other Greeks — Understanding Options 2E

    How delta, gamma, theta, vega, and rho quantify option risk and let you predict price changes before you place a trade.

  • Chapter 24: Trading Options with ETFs, Indexes, Weeklys, and Mini-Options — Understanding Options 2E

    Beyond single stocks — using ETF options, LEAPS, weeklies, and mini-contracts to hedge portfolios and target shorter time horizons.

  • Chapter 25: Advanced Strategies — Understanding Options 2E

    Iron condors, calendar spreads, and butterflies — multi-leg structures that reduce risk in exchange for capped profits.

  • Chapter 26: Sheldon Natenberg — Professional Options Trader — Understanding Options 2E

    Why volatility, not direction, is the central trade in options — distilled from professional educator Sheldon Natenberg.

  • Chapter 27: Where to Get Help — Understanding Options 2E

    Free and paid resources for continuing options education — from the OIC and CBOE to paper trading and brokerage education centers.

  • Chapter 28: Lessons I Learned About Options — Understanding Options 2E

    Distilled wisdom for retail options traders — start with covered calls, define exits, protect profits, and never stop monitoring your own account.

  • Understanding Options 2E — Book Summary — Understanding Options 2E

    A clear, strategy-by-strategy guide to options trading for individual investors — from covered calls and protective puts to spreads, straddles, and the Greeks.

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