Synthetics are the building blocks of the options trading world. Consider getting to know them, because you might be able to incorporate them as part of an overall options trading strategy.
Trying to decide which options strategy, strike price, or expiration date to trade? If capital efficiency is one of your criteria, consider return on capital (ROC).
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.
Some option traders dynamically hedge positions, but doing so requires a basic understanding of synthetic positions and put-call parity.
Learn how synthetic option positions can be made by certain combinations of calls, puts and the underlying stock.
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