Welcome To Options Trading For Newbies



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Options Trading For Newbies
AT-THE-MONEY (ATM) - An at-the-money option is one whose strike price is equal to (or, in practice, very close to) the current price of the underlying.
BACK MONTH - Aback month contract is any exchange-traded derivatives contract fora future period beyond the front month contract. Also called FAR MONTH.
BEAR, BEARISH - A bear is someone with a pessimistic view on a market or particular asset, e.g. believes that the price will fall. Such views are often described as bearish.
BEAR CALL SPREAD - This is a net credit transaction established by selling a call and buying another call at a higher strike price, on the same underlying, in the same expiration. It is a directional trade where the maximum loss = the diļ¬€erence between the strike prices less the credit received, and the maximum profit = the credit received. Requires margin.

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