Jul 14, 2012 | Option Trading Basics
What makes some stock option premiums worth so much more than others? Let’s say we have two stocks, A and B. Both are trading @ $25/share. We look to sell the same month at-the-money $25 strike and one (stock A) returns 2% and the other (stock B) 4%. WHY? The answer...
Jan 28, 2012 | Stock Option Strategies
So you sold an options contract for $380 and generated a 3.5% 1-month return. Did you ever wonder how the market determined the value of that options contract to be $380? The simple equation that most of us know and understand is the following: Option premium =...
Aug 22, 2010 | Option Trading Basics
So you sold an options contract for $380 and generated a 3.5% 1-month return. Did you ever wonder how the market determined the value of that contract to be $380? The simple equation that most of us know and understand is the following: Option premium = Intrinsic...
Jul 20, 2008 | Option Trading Basics
So you sold an options contract for $380 and generated a 3.5% 1-month return. Did you ever wonder how the market determined the value of that contract to be $380? The simple equation that most of us know and understand is the following: Option premium = Intrinsic...