Learn Stock Options: Options Made Simple 101

Discover the four basic option trades—buying or selling calls and puts—and how the right, not the obligation, to buy or sell a stock at a price creates these building blocks.

Apply the four plays in options trading by using calls and puts to hedge long or short positions or to speculate without owning the stock.

Explore the option chain and learn how to read call and put quotes, bid-ask, last price, volume, open interest, strikes, and delta to price and trade stock options.

Explore how the CBOE standardizes options to boost liquidity by defining 100-share contracts, standard strike multiples, and third Friday expiration, while noting exceptions for stock splits and ETFs.

Compare intrinsic value and time value to see how option prices form, and learn standard options nomenclature, including ticker, expiration, strike, and call or put type.

Look up option chains on your broker to see how calls, puts, and strikes appear, and explore using options to trade stocks more effectively.

Explore how option pricing works by dissecting intrinsic value, time value, and the premium, with examples and a look at the Greeks.

Describe how in the money, at the money, and out of the money relate to intrinsic value and time value in stock options, with strike price guiding their classification.

Learn how option price comprises intrinsic value and time value, with time value driven by time to expiration, volatility, interest rates, and dividends; Black Sholes formula powers pricing.

Explore how the Greeks measure option risk, including delta, theta, vega, gamma, and rho, and how implied volatility and time value shape option premiums under the Black-Scholes framework.

Estimate option prices from stock moves using intrinsic value, time value, and delta-driven calculations; explore theta and vega effects on puts and volatility.

Explore how to price a call option using a $49 strike, calculate intrinsic value, time value, and premium composition; analyze delta-driven price movement, time decay, ROI scenarios, and potential drawdown.

Master option pricing by focusing on delta, then learning the Greeks and practical rules, reinforced with homework exercises and real-world examples from the options chain.

Master the basic principles of stock options, including intrinsic value, time value, and time decay. Learn how delta, theta, vega, and volatility shape option pricing and basic strategies.

Learn basic option buying strategies for uptrends and downtrends, buying calls in bullish markets and puts in bearish markets, guided by the primary trend and five trade confirmations.

Select in-the-money call options with a delta near 50–70 and open interest above 1,000 to ensure intrinsic value and liquidity, then compare adjacent strikes on the option chain.

Choose the right option expiration by adding four weeks of extra time beyond expected trade duration, balancing open interest to avoid liquidation and difficulties getting in or out.

Understand how stock options create unique risk profiles through a profit-loss graph, comparing long stock, long call, and put options with premium, breakeven, and time decay.

Avoid buying options over earnings due to volatility and gaps. Buy in-the-money options with delta around 50 and open interest over 1,000, while watching implied volatility.

Review the options selection process, practice with virtual trades using virtual money, and assess outcomes; watch foundations of stocks and options videos for analysis.

Walk through the option buying checklist to identify trends, select in-the-money calls or puts, confirm trades, and manage delta, open interest, and volatility.

Walks through a bullish call option on Disney, starting with analysis of trend lines and moving averages, then selects an August 14, $85 call option and executes the buy.

Walk through a bearish put trade on Peabody using technical signals and in-the-money strikes. Learn to check open interest and place a limit order for August puts.

Close an options trade by taking the opposite of how you entered, e.g., buy to close after buy to open, or sell to close after sell to open, offsetting positions.

Discover three ways to close option trades: expire, exercise, or offset—while debunking the myth that 90% of options expire worthless.

Learn how trigger and contingency orders activate trades only when predefined criteria are met. Tie conditions to stock, option, or time and let computer handle trades and save time.

Explore variations of stop orders—stop, stop limit, and trailing stop—and learn how triggers, liquidity, and market versus limit execution affect exit prices.

Set stop orders and contingency orders to protect capital, using moving averages and average true range to place stops below support or above resistance, then trail and adjust.

Practice stock options with virtual trades, opening and closing positions, and repeat the process 10–15 times to build familiarity, prioritizing learning over profit.

Explore option pricing basics, including intrinsic value, time value, and premium, and examine how time decay, theta, expiration, and volatility shape option prices.

Explore how theta drives time decay in option pricing, showing how time value accelerates toward expiration, with differences across in, at, and out of the money options and leaps.

Understand how theta decays as options approach expiration and compare in-the-money versus out-of-the-money options, highlighting daily percentage losses and the risk of short-duration weekly options.

Master time decay by using four weeks extra time, closing options two weeks before expiration, and applying 3d option pricing focused on stock direction, strike in the money, and time.

Learn how option time decay and theta shape buying and selling strategies, with two weeks to expiration as a target, and using selling strategies like covered calls and credit spreads.

Analyze option data by month and expiration, compare weekly and leap options, and practice in a virtual account to understand time decay and risk.

Review the basic building blocks of options, including buying calls/puts, selling calls/puts, then explore three weekly strategies that use delta, time value, and open interest to align with stock movement.

Explore weekly options, including W-designated contracts expiring on their own Fridays with extra strike prices and high liquidity. Learn the theta decay and strategies to trade them carefully.

Learn three weekly strategies for using weekly options, focusing on a basic two-week trade with five to six weeks to expiration and noting open interest concerns for quick exits.

Demonstrates a weekly option day trading strategy to capture 20 to 40 cent intraday moves in the primary trend, using next week's weekly options and end-of-day exits.

Sell weekly options to exploit rapid time decay, using out-of-the-money, short-dated trades across 52 weekly expirations and capture premium before expiration.

Practice weekly option trades to observe time decay, try selling out-of-the-money weeklies, and explore weekly strategies for day traders, while reviewing basics of options.

Thank you for watching the options made simple training. Reach out with questions via the Trade Smart website and explore more courses at Trade Smart University for ongoing trading education.