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Hedging

A hedge is an investment strategy used to attempt to offset any potential losses. One way an investor can do this is to either sell futures on a stock they own, stating they will sell that stock at a certain price. A partial hedge is a hedge that partially covers your stock position, but not all of it. An investor might undertake a partial hedge if More...

by Marcus Holland | Published 11 years ago
By Marcus Holland On Thursday, April 4th, 2013
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Options Regulators

The OIC is the Options Industry Council. The OIC is a non-profit association intended to provide education and resources to investors in the form of educational videos, literature, software, seminars, and a call More...

By Marcus Holland On Thursday, April 4th, 2013
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Option Pricing Model

An option pricing model is any theory or model used to mathematically calculate the price for an option contract. Two of the most important factors used in determining option price are the length of the contract More...

By Marcus Holland On Thursday, April 4th, 2013
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Open Interest

Open interest refers to the number of futures or options contracts that are not delivered or closed on a particular day. In other words, this is the number of contracts that have been traded but have not yet been More...

By Marcus Holland On Thursday, April 4th, 2013
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Naked Option

A naked option is when the seller of an option contract sells call options without owning the underlying assets or securities. If the option is purchased for a certain price and the actual stock price has dropped, More...

By Marcus Holland On Thursday, April 4th, 2013
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Market Price

The market price is the price at which a stock can currently be bought or sold for. The price can fluctuate as a result of many different things including a company’s reported earnings and when significant changes More...

By Marcus Holland On Thursday, April 4th, 2013
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Margin Requirement

When a trader or investor wants to purchase more options than they have liquid cash for, they can purchase on margin, or credit, typically through a brokerage firm. This type of purchase uses the purchased shares More...

By Marcus Holland On Thursday, April 4th, 2013
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Maintenance call

When an investor chooses to purchase on margin, or credit, they must deposit an amount of money into a margin account.  The amount of money depends on the amount of margin the investor wants to use and is regulated More...

By Marcus Holland On Thursday, April 4th, 2013
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LEAPS

LEAPS stands for Long Term Equity Anticipation Security and are options that have longer than usual expiration. Most options have expiry cycles of three, six, or nine months while LEAPS can have an expiration of More...

By Marcus Holland On Thursday, April 4th, 2013
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Iron Condor

An Iron Condor is an advanced trading strategy that is created by selling a lower strike out-of-the-money put, buying an even lower strike out-of-the-money put, selling a higher strike out-of-the-money call and More...