Options Basics

This is a summary of the very basic terms and concepts of options, including calls and puts, option premium, intrinsic value, time value, implied volatility, and the Greeks. You can follow the links to get a more detailed explanation with examples.

Definition and Basic Logic of Options

Trading and Exercising Options

Strike Price of an Option

Market Price and Intrinsic Value of Options

In the Money, At the Money, Out of the Money

Time Value of Options and Time Decay

Historical and Implied Volatility

Delta, Gamma, Theta, and Vega

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