Options: The Basics
- Options – overview of basic terms and concepts
- What is an option? Calls and puts.
- 5 basic characteristics of every option
- Strike vs. market price vs. underlying price
- In the money, at the money, out of the money
- Exercising options and expiration
Basic Option Positions
- Call, Put, Long, Short, Bull, Bear… Confused?
- Call option payoff diagram, formula and logic
- Put option payoff diagram and formula
- Short call payoff diagram and formula
- Short put payoff diagram and formula
- Long call vs. short put differences and when to trade which
Option Pricing and Greeks
- Black-Scholes model – all resources
- Black-Scholes model history and key papers
- Black-Scholes model assumptions
- Black-Scholes model inputs (parameters)
- Black-Scholes formula (d1, d2, call price, put price, Greeks)
- Black-Scholes Excel formulas and how to create a simple option pricing spreadsheet
- Option Greeks Excel formulas
- Option delta
- Measuring directional exposure with delta: single option and option spreads
Volatility
- Volatility start page (all resources)
- Why is volatility proportional to the square root of time?
- Volatility rule of 16
- Historical volatility
- Historical volatility calculation
- Implied volatility
- Calculating implied volatility in Excel
VIX (CBOE Volatility Index)
- VIX start page (all resources)
- What is VIX? (short and long answer)
- VIX calculation explained
- VIX-SPX correlation
- VIX and S&P500 same direction statistics
- VIX futures
- VIX futures curve
- VIX options
- VIX expiration calendar (futures & options)
- VIX ETF & ETN list
- VIX COT (Commitment of Traders)
Statistics
- Summary statistics start page (all resources)
- Arithmetic average advantages and disadvantages
- Arithmetic average: When to use it and when not
- Median definition and calculation
- Calculating variance and standard deviation in 4 easy steps
- Population vs. sample variance and standard deviation
- Skewness formula
- Skewness in Excel (SKEW)
- Kurtosis formula
- Kurtosis in Excel (KURT)
Technical Analysis
- The three moving average parameters
- Finding the best moving average period length
- RSI calculation
- RSI overbought and oversold condition
- True Range
- ATR calculation
- Momentum
- Using MACD Histogram to trade the traditional MACD crossover