How Option Probability Works

Options trading can be profitable from either the buyer’s or the seller’s perspective. You can obtain value from them during times of certainty and uncertainty;...

Understanding an Options Premium

The premium is the price that the option holder pays to  buy options (for call contracts) or sell options (for put contracts) at a fixed rate when the term of the contract...

Understanding an Options Expiration Date

For derivative securities, the expiration date is the last day that the contract will be valid. For future contracts, this is the day that was set for both parts to...

Understanding an Options Strike Price

The strike of an option is the price stated in an option contract at which the option holder has the choice to acquire or sell an underlying asset at a fixed rate during or...

In the Money vs. Out of the Money Options

Options trading is all about choosing the right strategy. Should an investor go for an“in the money” (ITM) or “out of the money” (OTM) trade, which is represented by the...