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 better trader, whatever your current level of knowledge or experience.

The options trading education is in five main sections:

How Options Work

BusinessmanUnderstanding how options work is key for anyone wanting to trade options seriously. We look at the key things you need to know including the background and history of options trading, the so-called options greeks, how to calculate an options trade’s profitability and some key options terms. In particular we look at:

What Are Options?
Where did they come from? How do they work? What are the common types?

Using an Options Broker
How do you buy or sell options? How do you read an options chain?

Options Pricing Models
How do you work out how much to pay for an option?

Uses of an Option
What are options used for now? Focus on insurance, leverage and speculation.

Common Options Trading Terms
Glossary of key terms you need to know to be an options trader.

 


Option Greeks

6953637770_35cde4ac6f-e1385633824583Option Greeks are such an important part of understanding how to trade options that they have a section all on their own.
‘The Greeks’ are a collection of metrics used to measure how an options price changes given a change in factor. For example delta measures how much an options price moves should there be a change in the stock price. And vega is a measure of how volatity affects a stock’s options price.
For each delta below we look at exactly what its measure and, more importantly, how it can be used by a trade:

  • Delta
  • Gamma
  • Vega
  • Theta
  • Rho

Basic Option Spreads

Option Spreads are the way most options traders trade. They’re a combination of bought and sold options which are put on in such a way that they can be used to profit whenever an underlying security behaves in a forecast way. Here we look at some basic option spreads including covered calls and vertical spreads.

Advanced Option Spreads

Here we look at some advanced option spreads, used by sophisticated traders to profit whatever the market is doing. They have exotic names like calendar spreads, butterflies, iron condors, straddles and strangles but can be understood by any trader who understands the options fundamentals.


Options Brokers

Getting the right options broker is vital for any options trader. We consider what to look for – including cost, tools, education and user interface – so that you can match you knowledge and experience with the best broker for you. And then we review some of the main brokers: which is the best?

 

Each section is packed with valuable information to help you master the world of options trading. If you have any questions then don’t hesitate to contact me via the contact page. In the meantime best of luck and enjoy the site.

Chris Young
Owner, Epsilon Options