Ask Definition

This method is normally used when Options are overpriced. The trader would simply buy stocks in the open market and sell the equivalent position in the options market. This is done because the trader sees that the Options price is too high and anticipates that it will eventually decrease. So he/she decides to cash in…

This is a measure of Historical Volatility computed as the annualized standard deviation of returns over a period of days (20, 30, 90 days). See also Implied Volatility & Historical volatility

This is also known as a Crossed Trade and it is basically a transaction/trade that is done from one broker to another ( broker to broker) rather than in the open market place. See Also Option Conversion

I’ve been asked and have explained The Wheel strategy many times, so I thought it may be a good idea to write it down all in one place for posterity! This is the only options strategy I use and IMHO it is about as low risk and reliable as options trading gets. You will NOT get…

The Intrinsic Value is basically the value of an in-the-money option minus its time value. Intrinsic value is the current real tangible value of the options contract. The intrinsic value of a call option is calculated by subtracting the strike price of the Option from the underlying stock. For a put, intrinsic value is the…

This is basically the amount of intrinsic value that an options contract has. In other words, it is the relationship between the strike price of the option and the price of the underlying asset. See at-the-money and Deep in-the-money.