Option trading can be explained as buying or selling a contract with the expectations of making money before the option expires. An option buyer wants an option to go higher and be able to s... Read more
Here are five ways to effectively manage risk as an option trader: The first step in managing risk as an option trader is position sizing. When buying options the amount of capital you spend... Read more
Open interest quantity shows the total number of active contracts in each strike price and expiration date. Open interest is one of the columns displayed in an option pricing chain along wit... Read more
A put option contract gives the buyer of the contract the right to sell the underlying asset to the seller of the option at the strike price on the day of expiration. The put buyer has the r... Read more
Option pricing is based on the current probabilities that the option will expire in-the-money. Option contract prices are determined using the Black-Scholes pricing model for time, volatilit... Read more
