Archives: Learning Center
All About the Options Chain
Selecting which option to buy or sell is done in what’s known as the Options Chain. Henry Gambell introduces the Options Chain and key terms to know.
Conclusion
Henry reiterates the importance of understanding the options chain and gives 5 key facts to know about how we like to trade options at Simpler Trading.
Theta Decay
Theta decay, or time decay, affects the option’s price as it approaches expiration. Henry reviews the concept of theta decay and how it affects an option’s intrinsic and extrinsic value.
Delta + Strike Price
Dive deeper into one of the most important Greeks in trading, Delta, and how this can impact which strike you select.
The Greeks
The Greeks are important factors that determine and help influence options pricing. Henry defines Delta, Gamma, Theta, Vega, and Rho.
Moneyness: ITM, ATM, and OTM Options
Henry breaks down the importance of choosing your strikes when configuring your option spreads and the concepts of in-the-money, at-the-money, and out-of-the-money.
Implied Volatility
Discover what implied volatility is, how it impacts options traders, and how to view it in the Options Chain.
Options Expiration
One key difference between options and stocks is that options expire. Henry identifies the different types of expiration and how options are affected by this.