Options are derivative instruments that are widely used in the financial markets due to their versatility and range of strategies that can be implemented whether on their own or in combination with other options and/or stock. Options can be used to achieve different goals, some of which can only be implemented with options or options strategies due to their characteristics and special properties. Here are some of the practical uses for Options Strategies: Protection: Limiting the risk of large losses on existing assets (buying a Put, buying a Put Spread, etc) Speculation: Profiting from an underlying’s bullish or bearish price action (buying a Call, buying a Put, etc.) Income generation on existing positions: Managing risk on existing positions to generate an income stream based on Options Positions (Covered Call, etc.) Leverage: Controlling a position worth a large notional amount with only a fraction of the required capital (buying a Call, buying a Call Spread, etc.) Diversification: Diversifying a portfolio’s components using Options and their inherent low capital requirement (buying calls on Indices/ETFs, buying Puts on Indices/ETFs, etc) Flexibility in their use as Strategic Instruments: Profiting from changes in Implied Volatility, from the passage of time or from the magnitude of a price move regardless of its upward or downward direction (selling a Straddle, selling an Iron Butterfly, etc.)In this course you will learn all you need to know about Options Trading, analysis, evaluation, strategy design, maintenance and monitoring as part of a PortfolioIt doesn’t matter how extensive your existing knowledge of Options or Financial Markets is. In this course you will find all the tools you need to trade options efficiently and complement your existing portfolio or focus your entire methodology in the wide variety of options strategies that we will analyze conceptually, theoretically and in practice. The course’s structure and content will help you understand all the necessary concepts sequentially and in a clear and concise manner. We will primarily use visual and graphical material to help make complex concepts easier to understand. This is often an initial hurdle on your path towards efficient use and mastery of Options trading and we will make sure that nothing stands on your way to efficiently and profitably trading options. As part of a balanced approach among concepts, theory and practice we will use the paperMoney by thinkorswim Options Trading platform, with information accessed directly from US Financial Markets. Detailed instructions on how to gain access this platform and also how to create a demo account will be provided as part of your course. With this, you will be able to follow all the explanations and transactions on the platform along with us using real market data. Finally, as part of an ongoing process to ensure that you get the most out of this course and that you are ready to either start your options trading journey or take your options trading to the next level, you will be asked to take a quiz after each section. You will then be able to know which options concepts and techniques you have mastered and which areas need further attention and reinforcement, for which you will be taken directly to the lecture where this material can be reviewed. Course Summary 1. Call Options 101:Introduction to the concept of a Call Option as a contract that gives the buyer the right to purchase an asset at a predetermined price on or before the contract’s expiration date2. Put Options 101:Introduction to the concept of a Put Option as a contract that gives the buyer the right to sell an asset at a predetermined price on or before the contract’s expiration date3. Options for Stock Traders: Introduction to Options for those already familiar with trading Stocks4. Basic Option Concepts: Building blocks that serve as the foundation for a thorough understanding of Option Pricing and Trading5. VolatilityProbably the most important and often misunderstood concept in Options Trading: Volatility or how widely an underlying’s price is expected to fluctuate between now and a certain date6. Options Greeks: Delta: Introduction to Delta, how an Option Price changes as the Underlying Price changes, also used as a proxy for probability of expiring in-the-money and as a hedge ratio7. Option Greeks: Theta: Introduction to Theta: how an Option Price changes as time passes. A measure of time decay8. Option Greeks: Gamma: Introduction to Gamma: how Delta changes as the Underlying Price changes.9. Option Greeks: Vega: Introduction to Vega: how an Option Price changes as Implied Volatility changes10. Getting ready to analyze Options Strategies: Access to a real trading platform to practice and follow along with our analysis of the different options strategies reviewed in the following sections- Options Strategies -11. Buying a Call: Option Strategy Analysis: Long Call12. Buying a Put: Option Strategy: Analysis: Long Put13. Selling a Put: Option Strategy Analysis: Short Put14. Selling a Call:
