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Writing vs Buying Options | Is Selling Or Purchasing Stock Options Better?

The choice between writing vs buying options depends on a trader’s market view and risk tolerance. Here’s our guide. Stock options are financial instruments that give the holder the right, but not the obligation, to buy or sell a specific stock at a predetermined price within a certain time frame. There are two main ways […]

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Further Reading On Options Trading...

Options Trading Strategies: Call And Put Backspreads

Backspreads: Extreme Bullish Or Bearish Options Trading Strategies What Are Backspreads? A backspread is very bullish or very bearish strategy used to trade direction; ie a trader is betting that ...
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Options Spreads: Put & Call Combination Strategies

Options Combinations Explained Options spreads involve the purchase or sale of two or more options covering the same underlying stock or security (ref). These options can be puts or calls ...
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Put Call Parity

Put Call Parity Introduction Options trading can be relatively simple and can also become highly technical. One of the most important basic concepts when it comes to trading options is ...
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In The Money (ITM) Options Explained

In the money options are those whose strike price is less (for call options) or more (for put options) than the current underlying security price. Options provide the right to ...
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Stock Option Strike (Exercise) Price Explained

The option strike price (also known as the exercise price) is a term used in options trading. Options are derivatives. These financial instruments are ‘derived’ from another underlying security such ...
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Extrinsic Value In Options Trading

What is Extrinsic Value In Options Trading? The extrinsic value of a stock option contract is the portion of the option's worth that has been assigned to factors other than ...
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How To Learn Stock Options Trading: Stock Options For ‘Dummies’

Would you like to learn stock options trading but don't know where to start? Well we've got your back and designed this step by step guide on how to educate ...
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Covered Calls Options Strategy Guide

Introduction To Covered Calls Covered calls have always been a popular options strategy. Indeed for many traders, their introduction to options trading is a covered call used to augment income ...
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Options Theta Explained: Price Sensitivity To Time

Options theta measures option price sensitivity to time. Time Decay & Options Theta All things being equal options lose value over time - so called 'time decay' - and theta ...
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How Options Work: Trading Put And Call Options

Learning how options work is a key skill for any trader or investor wanting to add this to their arsenal of trading weapons. It’s really not possible to trade options ...
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Options Trading Strategy: Long Call

A long call option strategy is the purchase of a call option in the expectation of the underlying stock rising. It is delta and theta positive. Introduction Options can provide ...
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Gamma Scalping Options Trading Strategy: A Concise Guide for Traders

Gamma scalping is a sophisticated options trading strategy primarily employed by institutions and hedge funds for managing portfolio risk and large positions in equities and futures. As a complex technique, ...
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Options Trading Education

Options trading is a potential lucrative sideline for those willing to put in the effort. Epsilon Options is here to help you learn the skills you’ll need to become a ...
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Options Delta Explained: Sensitivity To Price

Options Delta is the measure of an option’s price sensitivity to the underlying stock or security’s market price. It is the expected change in options price with a 1c change ...
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Options Greeks: Theta, Gamma, Delta, Vega And Rho

The options greeks - Theta, Vega, Delta, Gamma and Rho - measure option price sensitivity to changes in time, volatility, stock price and other parameters. In the world of finance, ...
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Pros And Cons Of Options Trading: Advantages & Disadvantages

Options trading has many advantages over stock investment. They are flexible, can be used to manage risk and are capital efficient. But there are also several key disadvantages. Here’s our guide to the pros and cons of options trading: What Are Options? Options are contracts that allow an investor the option to purchase or sell […]

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Further Reading On Options Trading...

Extrinsic Value In Options Trading

What is Extrinsic Value In Options Trading? The extrinsic value of a stock option contract is the portion of the option's worth that has been assigned to factors other than ...
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LEAP Options Explained: What Are They And How Do They Work?

Investors that are looking to make longer-term bets may use LEAP Options. Description of LEAP Options A LEAP option is essentially an option with longer terms than standard options. The ...
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Options Gamma Explained: Delta Sensitivity To Price

Gamma is the options greek measuring the sensitivity of delta to changes in stock price. Option traders tend to find it relatively easy to understand how the first-order Greek metrics ...
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Options Trading Strategy: Bear Put Spread

Introduction Options can be an extremely useful tool for short-term traders as well as long-term investors. Options can provide investors with a vehicle to bet on market direction or volatility, ...
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Call Option Payoff

A call option payoff depends on stock price: a long call is profitable above the breakeven point (strike price plus option premium). The opposite is the case for a short ...
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In The Money (ITM) Options Explained

In the money options are those whose strike price is less (for call options) or more (for put options) than the current underlying security price. Options provide the right to ...
Read More

Gamma Scalping Options Trading Strategy: A Concise Guide for Traders

Gamma scalping is a sophisticated options trading strategy primarily employed by institutions and hedge funds for managing portfolio risk and large positions in equities and futures. As a complex technique, ...
Read More

Position Delta | What Is It? How Is It Calculated?

Position delta is the profit or loss of the entire option position relative to a $1 change in the price of the underlying asset. It is usually expressed in dollar ...
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Stock Option Strike (Exercise) Price Explained

The option strike price (also known as the exercise price) is a term used in options trading. Options are derivatives. These financial instruments are ‘derived’ from another underlying security such ...
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The Synthetic Covered Call Options Strategy Explained

What Is A Synthetic Option Strategy? A synthetic covered call is an options position equivalent to the covered call strategy (sold call options over an owned stock). It consists of ...
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Options Trading Strategy: Iron Condor

Introduction Options are highly versatile financial instruments. They can be used to bet on market direction, to bet on changes in implied volatility or even to collect premiums. Options can ...
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Options Delta Explained: Sensitivity To Price

Options Delta is the measure of an option’s price sensitivity to the underlying stock or security’s market price. It is the expected change in options price with a 1c change ...
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Calendar Spread

The Calendar Spreads Options Strategy What is a Calendar Spread? Intro Calendar Spreads are one of the key non-directional strategies used by options traders to make money in any market ...
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Vertical Spread Options Strategy: Definition And Examples

What Is A Vertical Spread?: Definition A vertical options spread is a combination of bought or sold options of the same underlying security and expiry date (but different strike prices) ...
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Strangle Spread: A Guide To This Options Trading Strategy

The Strangle Spread Options Trading Strategy Introduction Options, and combination trades such as the strangle spread, can be a very useful tool for both novice and seasoned traders and investors ...
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The 5 Best Options Strategies for Trading Earnings

We all know that earnings season can be a volatile time for stocks. But did you know that there are options strategies you can use to trade earnings announcements? In this post, we’ll discuss the five best options strategies for trading earnings announcements. We’ll also provide some tips on how to pick the right strategy […]

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Further Reading On Options Trading...

Call Option Payoff

A call option payoff depends on stock price: a long call is profitable above the breakeven point (strike price plus option premium). The opposite is the case for a short ...
Read More

Straddle Spread: Learn This Options Trading Strategy

Options Trading Strategy: Straddle Spread Introduction The straddle spread is a relatively simple options strategy that can be used under different market scenarios. However its most normal use is a ...
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Bearish Options Strategies | Profit From Stock Downturns

Bearish options strategies are used to take advantage of a downward market trend. They help you profit from falling prices, rather than bearing the decline directly from holding stocks. Where ...
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Options Trading Strategy: Long Put

What Is A Long Put? A long put option strategy is the purchase of a put option in the expectation of the underlying stock falling. It is delta negative and ...
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Options Trading Strategy: Long Call

A long call option strategy is the purchase of a call option in the expectation of the underlying stock rising. It is delta and theta positive. Introduction Options can provide ...
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Extrinsic Value In Options Trading

What is Extrinsic Value In Options Trading? The extrinsic value of a stock option contract is the portion of the option's worth that has been assigned to factors other than ...
Read More

The Long Box Spread Options Strategy | Risk Free ‘Arbitrage’

The long box spread options strategy involves buying a bull call spread simultaneously with a bear put spread, both of which have similar strike prices and expiration dates of the ...
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Options Spreads: Put & Call Combination Strategies

Options Combinations Explained Options spreads involve the purchase or sale of two or more options covering the same underlying stock or security (ref). These options can be puts or calls ...
Read More

LEAP Options Explained: What Are They And How Do They Work?

Investors that are looking to make longer-term bets may use LEAP Options. Description of LEAP Options A LEAP option is essentially an option with longer terms than standard options. The ...
Read More

Options Trading Strategy: Bull Call Spread

The Bull Call Spread: A Bullish Options Strategy Introduction The bull call spread is a simple strategy that can be used by novice options traders to bet on higher prices ...
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Puts and Calls: Stock Options Explained

What Are Puts and Calls? We've seen before exactly what options are, how they work and their function. Here we go further and explore the two main flavour of options ...
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Out Of The Money (OTM) Options Explained

Out of the money (OTM) options: where the exercise price for a call is more than the current underlying security’s price (or less for a put). This is an example ...
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Sell to Open vs Sell to Close

What is Sell to Open vs Sell to Close? We look at these two similar, but not exactly the same, concepts. There are two ways to participate in the options ...
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Implied Volatility

What Is Implied Volatility? Implied volatility (IV) is one of the most important concepts in options trading. Unfortunately it’s also one of the most complex. Therefore, let’s build up the ...
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Calendar Spread

The Calendar Spreads Options Strategy What is a Calendar Spread? Intro Calendar Spreads are one of the key non-directional strategies used by options traders to make money in any market ...
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Short Call Options Trading Strategy: How to Use It and When

A short call options trading strategy is simply when you sell or write a call option on an underlying security with the hope that the price will fall so that you can buy it back at a lower price and pocket the difference as profit.For example, let’s say XYZ stock is currently trading at $50 […]

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Further Reading On Options Trading...

Calendar Spread

The Calendar Spreads Options Strategy What is a Calendar Spread? Intro Calendar Spreads are one of the key non-directional strategies used by options traders to make money in any market ...
Read More

The Synthetic Covered Call Options Strategy Explained

What Is A Synthetic Option Strategy? A synthetic covered call is an options position equivalent to the covered call strategy (sold call options over an owned stock). It consists of ...
Read More

Options Vega Explained: Price Sensitivity To Volatility

Options Vega is the measure of an option’s price sensitivity to changes in volatility. It is the expected change in options price with a 1 point change in implied volatility ...
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Buy to Open vs Buy to Close

What is Buy to Open vs Buy to Close? We look at these two similar, but not exactly the same, concepts. (We have similar post on the opposite trade: Sell ...
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In The Money (ITM) Options Explained

In the money options are those whose strike price is less (for call options) or more (for put options) than the current underlying security price. Options provide the right to ...
Read More

Stock Option Strike (Exercise) Price Explained

The option strike price (also known as the exercise price) is a term used in options trading. Options are derivatives. These financial instruments are ‘derived’ from another underlying security such ...
Read More

Options Trading Strategy: Iron Condor

Introduction Options are highly versatile financial instruments. They can be used to bet on market direction, to bet on changes in implied volatility or even to collect premiums. Options can ...
Read More

Options Trading Strategy: Bull Call Spread

The Bull Call Spread: A Bullish Options Strategy Introduction The bull call spread is a simple strategy that can be used by novice options traders to bet on higher prices ...
Read More

Covered Calls Options Strategy Guide

Introduction To Covered Calls Covered calls have always been a popular options strategy. Indeed for many traders, their introduction to options trading is a covered call used to augment income ...
Read More

How Options Work: Trading Put And Call Options

Learning how options work is a key skill for any trader or investor wanting to add this to their arsenal of trading weapons. It’s really not possible to trade options ...
Read More

Call Option Payoff

A call option payoff depends on stock price: a long call is profitable above the breakeven point (strike price plus option premium). The opposite is the case for a short ...
Read More

Options Trading Strategy: Butterfly Spread

Introduction To Butterfly Spreads Options can provide traders and investors a tool for expressing different market opinions. Options can be used to make trades based on market direction, to bet ...
Read More

Options Trading Strategies: Call And Put Backspreads

Backspreads: Extreme Bullish Or Bearish Options Trading Strategies What Are Backspreads? A backspread is very bullish or very bearish strategy used to trade direction; ie a trader is betting that ...
Read More

Puts and Calls: Stock Options Explained

What Are Puts and Calls? We've seen before exactly what options are, how they work and their function. Here we go further and explore the two main flavour of options ...
Read More

Options Spreads: Put & Call Combination Strategies

Options Combinations Explained Options spreads involve the purchase or sale of two or more options covering the same underlying stock or security (ref). These options can be puts or calls ...
Read More

Buying Straddles Into Earnings

Buying straddles into earnings is a popular way to trade stock movements after an earnings announcement. Our guide to this strategy and its pros and cons:

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Further Reading On Options Trading...

Options Trading Strategy: Butterfly Spread

Introduction To Butterfly Spreads Options can provide traders and investors a tool for expressing different market opinions. Options can be used to make trades based on market direction, to bet ...
Read More

Straddle Spread: Learn This Options Trading Strategy

Options Trading Strategy: Straddle Spread Introduction The straddle spread is a relatively simple options strategy that can be used under different market scenarios. However its most normal use is a ...
Read More

Options Trading Strategy: Iron Condor

Introduction Options are highly versatile financial instruments. They can be used to bet on market direction, to bet on changes in implied volatility or even to collect premiums. Options can ...
Read More

Call Option Payoff

A call option payoff depends on stock price: a long call is profitable above the breakeven point (strike price plus option premium). The opposite is the case for a short ...
Read More

Sell to Open vs Sell to Close

What is Sell to Open vs Sell to Close? We look at these two similar, but not exactly the same, concepts. There are two ways to participate in the options ...
Read More

Options Brokers Reviews

How To Choose The Best Options Broker There are several things an option trader needs to look for in an options broker. However, whilst most traders will need most, if ...
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Options Trading Education

Options trading is a potential lucrative sideline for those willing to put in the effort. Epsilon Options is here to help you learn the skills you’ll need to become a ...
Read More

Options Trading Strategy: Long Put

What Is A Long Put? A long put option strategy is the purchase of a put option in the expectation of the underlying stock falling. It is delta negative and ...
Read More

Covered Calls Options Strategy Guide

Introduction To Covered Calls Covered calls have always been a popular options strategy. Indeed for many traders, their introduction to options trading is a covered call used to augment income ...
Read More

The Long Box Spread Options Strategy | Risk Free ‘Arbitrage’

The long box spread options strategy involves buying a bull call spread simultaneously with a bear put spread, both of which have similar strike prices and expiration dates of the ...
Read More

Position Delta | What Is It? How Is It Calculated?

Position delta is the profit or loss of the entire option position relative to a $1 change in the price of the underlying asset. It is usually expressed in dollar ...
Read More

Gamma Scalping Options Trading Strategy: A Concise Guide for Traders

Gamma scalping is a sophisticated options trading strategy primarily employed by institutions and hedge funds for managing portfolio risk and large positions in equities and futures. As a complex technique, ...
Read More

Out Of The Money (OTM) Options Explained

Out of the money (OTM) options: where the exercise price for a call is more than the current underlying security’s price (or less for a put). This is an example ...
Read More

Put Call Parity

Put Call Parity Introduction Options trading can be relatively simple and can also become highly technical. One of the most important basic concepts when it comes to trading options is ...
Read More

Stock Option Strike (Exercise) Price Explained

The option strike price (also known as the exercise price) is a term used in options trading. Options are derivatives. These financial instruments are ‘derived’ from another underlying security such ...
Read More