#Straddles vs #Strangles ( Sell only )

These are the most common #Options strategies when one would start with #OptionsTrading.

Let’s understand from a broader perspective what’s the difference between these two.

These are the most common #Options strategies when one would start with #OptionsTrading.

Let’s understand from a broader perspective what’s the difference between these two.

Would not like to discuss the construction difference between them if you don’t know stop trading #options

#Straddles

You get higher premium so pnl would be higher compared to #strangles

But from where are you getting higher premiums is that your selling 0.5 #delta.

#Straddles

You get higher premium so pnl would be higher compared to #strangles

But from where are you getting higher premiums is that your selling 0.5 #delta.

So probability of one going wrong is always 50% so to simply put one side is goin to get stuck in a #straddle but then market tends to #flucuate a lot so there is always the case of #meanreversion if you have selected the #strike rightly.

#Option #Greeks Simplified

#Options are definitely more complicated than equity or futures.

Their prices don’t just go up and down.

They also fluctuate based on things like #time, #implied #volatility and #underlying stock movements.

#Options are definitely more complicated than equity or futures.

Their prices don’t just go up and down.

They also fluctuate based on things like #time, #implied #volatility and #underlying stock movements.

#Options #Greeks Are Simply Mathematical Shortforms

Most of you would remember from school that mathematical formulas sometimes were #Greek letters like Pi and #Delta. The same is true for options.

Don’t let them overwhelm you or scare you.

Most of you would remember from school that mathematical formulas sometimes were #Greek letters like Pi and #Delta. The same is true for options.

Don’t let them overwhelm you or scare you.

They’re simply #mathematical words to explain some very basic principles.

#Greeks Describe the Behavior of #Individual #Options

Each #greek can help predict how it will behave under different circumstances and how options prices would change.

#Greeks Describe the Behavior of #Individual #Options

Each #greek can help predict how it will behave under different circumstances and how options prices would change.

Option Greeks : Myths and Realities

Option Greeks estimate how an option's price changes with ::

1.Underlying stock price : #Delta and #Gamma

2. Interest Rates : #Rho

3. Volatility : #Vega

4. Time : #Theta

Option Greeks estimate how an option's price changes with ::

1.Underlying stock price : #Delta and #Gamma

2. Interest Rates : #Rho

3. Volatility : #Vega

4. Time : #Theta