Trading options means thinking (and acting) with the inner quant brain. Once you get into the mindset, that analytical thinking might show up as you assess other investments—and other life decisions.
Learn how following short interest and other short-selling metrics can help investors gain valuable insights into companies and markets.
Do the headwinds of time decay turn you off from buying single options on volatile stocks? Find out how you may be able to turn the headwinds into tailwinds by trading those stock moves.
Learn how weekly stock options can help you target your exposure to market events such as earnings releases or economic events.
When a stock suddenly enters a hyperbolic rally without clear fundamental reasons, it could be a classic short squeeze. And when it involves options, a so-called 'gamma squeeze' can exacerbate the moves—up and down.
When you've got trades on, you typically focus on your profits or losses. But you could lose more times than you win and still come out ahead. Learn how to use probabilities to manage your options positions.
The effect of interest rates on options prices—rho—is sometimes considered the forgotten greek. But interest rates matter, especially when deciding when to exercise options positions.
As stock options get closer to their expiration date, options prices can change quickly. Understanding options gamma could help you manage your stock options positions better.
Delta contains information that matters most when you are looking for a profit. But there is more to delta.
Vega can show you how much the dollar value of an option changes for every one percentage point change in volatility. But traders often confuse vega with volatility. Knowing the right way to use vega can help you come up with an options trading strategy.
Learn how a long calendar spread can be effective in a low-volatility trading environment.
Useful thinkorswim tools you can use are the Heat Map, volatility calculation and Mobile Trader. Find out which stocks are moving, different ways to calculate volatility and share charts on Mobile Trader.
Big changes in stock prices can happen anytime, which is why option traders need a risk management strategy in place to withstand persistent rallies and potentially profit if and when a selloff happens.
Calendars and butterfly strategies may look similar but they have their differences. Why would you choose one over the other?
Traders sometimes talk glowingly about thrilling options trading strategies without considering the risks. There are some alternative strategies such as short out-of-the-money verticals that you could consider to better manage your risks.
The sensitivity of option prices to changes in time, volatility, and the price of the underlying are commonly referred to as “Greeks.” As you prepare for earnings season, here's an overview.
Options on futures are quite similar to their equity option cousins, but a few differences do exist.
Learn how to dynamically hedge changes in an option position’s delta in a process known as “gamma scalping.”
Some option traders dynamically hedge positions, but doing so requires a basic understanding of synthetic positions and put-call parity.
Learn about gamma, which some traders consider the positive side of negative theta.
If you have a directional view on a stock price, buying a vertical spread might be for you. But deciding on strikes and strike widths requires some thought.
Some economic indicators create more noise than others—learn to create trading strategies based on how markets might react to economic data.
Part of our series on portfolio margin, the greeks—theoretical metrics describing how things like stock price, time, and volatility can impact option price.
Managing risk variables you didn’t know you could control—lessons learned in 2016 about direction, time, and vol, and what mistakes to avoid this year.
With gold futures prices swinging up and down, options traders may have an opportunity to exercise non-directional strategies like straddles and strangles.
Learn how to increase the flexibility of your existing options strategies with weeklys: options that move quickly and live for about a week.
The greeks option traders use are loved by many, but understood by few. Know the false “truths” about option greeks to better manage your trades.
Weeklys on SPX: Now options traders have even more toys to play with... and more to chew on. Find out about them before changing your trading strategy.
Sometimes the options market can signal when it’s time to adjust a trade. But how long should options traders stick with an adjustment plan?
Learn how synthetic options strategies can help traders potentially lower transaction costs, improve price discovery, and more efficiently use capital.
Industry data shows options trading numbers are growing. But many stock traders remain hungry for options trading basics. Here’s how to get started.
Income-focused option trades succeed when the market doesn’t move that much. Learn how to recognize income opportunity.
Buying calls and puts is great when the stars align. For the spread trader, anything is possible. And the vertical spread is all where it begins.
Options greeks can help measure how much an option might gain or lose—and help you decide how much risk you’re willing to take.
A guide to weeklys: Volume is swelling, and traders are using weekly options to speculate on very short-term moves, or simply as a hedge.
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Be sure to understand all risks involved with each strategy, including commission costs, before attempting to place any trade. Clients must consider all relevant risk factors, including their own personal financial situations, before trading.
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