Useful information

Bildschirmfoto 2023-07-19 um 11.23.18.png

OPTION

Definition:

Choice, alternative

The right to buy or sell a certain thing within a time frame at a fixed price

Option. Call. Put. Volatility. Delta. Short call, covered call. Short put, covered put. Time value.

CALL

A call option is a contract that gives the buyer the right (the seller the obligation) to buy a share at a certain price and exercise date (the seller the obligation to sell); contract: usually 100 shares

Graphics +

Trading-Grafiken auf dem Computermonitor

Graphics +

PUT

Co-Founder

A put option is a contract that gives the buyer the right (the seller the obligation) to sell a share at a certain price and exercise date (the seller the obligation to buy); contract: usually 100 shares

VOLATILITY

Fluctuation of time series; fluctuation of prices within a period of time

The higher the volatility, the higher the option price paid

DELTA

How does the option price change if the optioned value (underlying) changes by one unit

Graphics +

Important:
The securities selected for selling the option should have positive price prospects!

SHORT-CALL
COVERED CALL (covered)

Profit from selling a covered call is capped at the option premium and the exercise price. (Stock held if underlying rises above the strike price and is called by the option buyer.)

Profit for the seller of the option is the option premium plus the gain from the difference between the strike price and the share price at the time the option is sold.

SHORT PUT COVERED PUT (covered)

The profit from selling a cash-covered put is "only" the option premium (cash coverage in the event of exercise, when the underlying is quoted below the strike price and is called by the option buyer); "Profit lies in the purchase" for the option seller, since the value can be purchased more cheaply after delivery than at the time the option was sold.

Graphics +

Important:
The securities selected for selling the option should have positive price prospects!

Graphics +

TIME VALUE

Expresses the part of an option premium that represents the remaining value over the term. Time value is the option premium minus the "intrinsic option value" ("in the money"). Towards the end of the term, the time value drops to "0".