What is Theta? What is option time decay? How does time decay work? These are common questions of beginning options traders. Theta is the Greek term used to denote option time decay. Theta is one of ...

Discover how Vega affects options pricing by measuring sensitivity to volatility changes. Learn its impact on trading strategies with clear examples and key takeaways.

Have you found strategies that make use of the decay of an option's theta that are attractive but you can't stand the associated risk? At the same time, conservative strategies such as covered-call ...

The "Greeks" are an essential toolkit for options investors and traders. These mathematical calculations, each named after a ...

Understanding the risks of shorting options and the importance of managing positions well for successful trading strategies.

J.W. Jones writes: As discussed in the first article, “The Hidden Potential of Learning How to Trade SPX and Gold Options” I pointed out that there are several fundamental principles that must be ...

Finding optimal swing trades can be tricky when the stock market is chopping in a range. However, volatility option strategies that benefit from time decay can be a great choice, especially if implied ...

In options trading, the extrinsic value of an option represents the portion of the option's price that's based on factors other than the immediate value of exercising it. Also known as “time value,” ...