Key Takeaways How liquidity and tight spreads have factored into the growth of zero-days-to-expiration (0DTE) options  The bulk of 0DTE trading takes place using options on major stock indexes, such as the SPX or NDX  Understand basic risk exposure in a 0DTE options trading strategy  The following, like all our strategy discussions, is strictly for […]

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Key Takeaways Understand the difference between calls and puts Learn the rights and obligations of buying and selling call and put options Understand the risk and reward profiles of long and short call and put options positions Options give traders, well, options. But options aren’t just for traders; qualified investors can trade options too. Investors […]

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Key Takeaways American-style options can be exercised at any time before expiration Addressing options dividend risk involves comparing the amount of a dividend against an options position’s extrinsic (time) value People who trade options do so for a number of reasons: to target downside protection, to potentially enhance income from stocks they own, or to […]

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Key Takeaways Amazon (AMZN) announced a 20-for-1 stock split effective June 6, 2022 Tesla (TSLA) announced that it’s seeking permission for a stock split When companies split shares, valuations and obligations should remain intact So, you traded stocks awhile, got comfortable with the ebb and flow and decided to add options to your lineup. You […]

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Key Takeaways Cboe Mini options are designed to track the underlying symbol accordingly, but at one-tenth of the price. Minis are comparable to their ETF counterparts but carry a couple potential advantages. These products may provide greater flexibility for new index options traders. Building a smaller account can be a thrilling adventure, full of promise […]

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Key Takeaways Margin on futures can help establish a relatively large position, but it also adds certain risks A certain amount of money, the maintenance margin, must always be maintained on deposit with a futures broker When losses exceed maintenance margin, it may trigger a “margin call” at any time during the trading day Levers […]

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Key Takeaways If you’re considering options trading, a great starting point is learning the difference between calls and puts Know when it might be better to use call options strategies versus put options strategies Learn how to apply basic options strategies and how to analyze their potential risk-reward outcomes When you try something new, you […]

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Key Takeaways Understand the difference between implied and historical volatility and how to use them to analyze overall options volatility Know how to analyze relationships between options prices and other metrics such as options greeks and volatility values Learn how to apply implied volatility, historical volatility, and price relationships to help make options trading decisions […]

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Key Takeaways Market makers are intermediaries—professional traders paid to take risk and provide liquidity to the market Market makers engage in arbitrage, using proprietary algorithms and mathematical models The competing objectives of market makers, institutional players, and retail traders can make for a vibrant, competitive marketplace So, you’ve done your research, logged into the trading platform, […]

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Key Takeaways A standard equity options contract is based on physical delivery of 100 shares of stock Some broad-based index options are cash settled, with a multiplier of $100 times the index Futures contracts—and the options based on them—vary in size and tick value You don’t check the water in the middle of a swan […]

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