Rho is the rate at which the price of a derivative changes relative to a change in the risk-free rate of interest. Rho measures the sensitivity of an option or options portfolio to a change in interest rate. Rho may also refer to the aggregated risk exposure to interest rate changes that exist for a book of several options positions. For example, […]
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A call is an option that gives the buyer the right, not the obligation, to buy an underlying asset at a certain point in time at a certain price. A put option gives the buyer the right, not the obligation, to sell an underlying asset at a certain point in time at a certain price. […]
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In contrast to historical volatility (HV), which looks at actual asset prices in the past, implied volatility (IV) looks ahead. … Implied volatility can be derived from the price of an option. Specifically, implied volatility is the expected future volatility of the stock that is implied by the price of the stock’s options Click the video below to see how we dive into this important aspect […]
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When a new trader hears the term “broken wing butterfly” it tends to send shivers down his or her spine. The term sounds really complicated. It does not have to be. If you break down the components of a bwf, you will see that it is simply buying one vertical spread and selling a narrower […]
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Shares of Ulta Beauty tanked more than 20% after the company reported earnings after the bell Thursday that missed analysts’ expectations and slashed its outlook for the fiscal year. The company said that the cosmetics industry has struggled as a whole this cycle, because there haven’t been innovative beauty routines that drive consumers to purchase products as […]
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Even if you don’t watch financial news, you have to know that gas prices are probably somewhere around when you were let’s just say quite a bit younger. Click the video below to see how Scott explains his take on the energy market Follow him on Twitter @CboeSib
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Cash dividends affect option prices through their effect on the underlying stock price. Because the stock price is expected to drop by the amount of the dividend on the ex-dividend date, high cash dividends imply lower call premiums and higher put premiums. Click the video below to see how I break this down for the class. Follow me at on Twitter @CboeSib
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What to do when you hold an option at expiration that is in the money? Many feel it’s time to panic. That is not the case. Click the video below to find out why. Follow me on Twitter: @CboeSIB
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This morning, Scott Bauer joined Oliver Renick on TD Ameritrade Network‘s Morning Trade Live to discuss an example trade on $NVDA and more Grab a free day pass to Scott’s live signal trading room today: http://bit.ly/nlonedaypass
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Our position in Zillow ($Z) has been quite profitable, but far from ordinary. Take a look at this video to see how we can maximize our profit potential. Grab a free day pass to Scott’s live signal trading room today: http://bit.ly/fbdaypass Don’t forget to follow Scott on Twitter @CboeSIB
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