Course Content
What Are Stock Options?
An overview of what stock options are, including the difference between call and put options. This lesson introduces key terms such as strike price, expiration date, premium, hedging and speculation, laying the foundation for all future lessons.
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Introduction to Stock Options
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Cash-Secured Puts
Master the art of cash-secured puts, a low-risk options strategy designed to generate consistent income and secure great entry points on stocks. Perfect for beginners seeking to build confidence in options trading.
Put Options Explained
Explore the mechanics of put options, which grant the buyer the right to sell an asset at a specific price. Learn when and why traders use puts for profit or protection in falling markets.
Call Options Explained
This lesson dives deeper into call options, explaining how they give the buyer the right, but not the obligation, to purchase an asset at a specific price. You will explore scenarios where call options are profitable and how to evaluate them.
Introduction to Covered Calls
In this lesson, you will learn about covered calls, a conservative options strategy used to generate income from stocks you already own. This strategy involves selling call options against your stock holdings, allowing you to collect a premium while retaining ownership of your shares. We will cover the basics of how covered calls work, the ideal scenarios for using this strategy, and the potential risks and rewards. By the end of the lesson, you will understand how to use covered calls to enhance portfolio returns while managing risk.
Understanding the Greeks in Options Trading
This lesson provides an introduction to the Greeks, key metrics that help traders evaluate the risk and behavior of options. You will learn about Delta, Gamma, Theta, Vega, and Rho, each representing a specific factor affecting an option's price. The lesson will explain how these variables measure sensitivity to stock price movements, time decay, volatility, and interest rate changes. By mastering the Greeks, you will gain a deeper understanding of how options behave in different market conditions and how to use this knowledge to refine your trading strategies.
Options Pricing: Intrinsic vs. Extrinsic Value
This lesson breaks down the components of an option’s price. You will learn how intrinsic value is derived from the stock’s price and how extrinsic value is influenced by factors such as time to expiration and market volatility.
Time Decay and Options (Theta)
Learn how time decay affects options prices. This lesson focuses on Theta, explaining how the value of an option erodes as it approaches expiration and how traders can use this to their advantage.
Volatility and Options (Vega)
This lesson explains how volatility impacts options prices. You will learn about implied volatility, its role in pricing, and strategies for trading high- or low-volatility markets.
Risk Management with Options
Master the art of managing risk using options. This lesson covers concepts like position sizing, stop-loss orders, and hedging strategies to protect your portfolio.
Protective Puts
Learn how to use protective puts as an insurance strategy to safeguard your portfolio against significant losses while maintaining upside potential.
Straddles and Strangles
This lesson introduces advanced strategies for profiting in volatile markets. You will learn how to use straddles and strangles to capture large price movements in either direction.
Iron Condors and Credit Spreads
Explore strategies designed to generate income with limited risk. This lesson explains how iron condors and credit spreads work and when to use them.
Options Assignment and Expiration
Understand what happens when options expire or are exercised. This lesson explains the assignment process and how to manage positions nearing expiration.
LEAPS: Long-Term Equity Anticipation Securities
Learn how to use LEAPS to make long-term investments in stock options, taking advantage of their extended expiration dates for strategic planning.
Rolling Options Positions
This lesson explains how and why traders roll options positions to extend duration, adjust strike prices, or manage risk in response to market movements.
Building an Options Trading Plan
Develop a step-by-step framework for building your personal options trading plan. Learn to set goals, define strategies, and track your performance effectively.
Common Mistakes in Options Trading
Avoid costly errors with this lesson on the most common mistakes beginners make in options trading, such as overleveraging, ignoring the Greeks, or mismanaging risk.
What are Stock Options?
About Lesson

Welcome to your first step in understanding stock options! This lesson is designed to simplify the concept of stock options and help you build a strong foundation.

Main Lesson Content:

  • What Are Stock Options?
    Stock options are financial tools that give you the right, but not the obligation, to buy or sell a stock at a specific price before a certain date.

  • Key Terms to Know:

    • Call Option: Right to buy a stock.
    • Put Option: Right to sell a stock.
    • Strike Price: Predefined price for the trade.
    • Expiration Date: The date the option expires.
    • Premium: The price you pay to buy the option.

  • Why Use Stock Options?
    Stock options are powerful for hedging, speculation, and income generation.

  • Advantages and Risks:
    Stock options offer flexibility and leverage but require careful management to avoid losses.

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