
Getting Started
How this course was set up, best practices, progress and quizzes.

Module 1: The Futures Market
If you want to understand options, you need to know some basics of the Futures Markets. What are they and how are they regulated?

Module 2: Trading Futures
How do you trade the Futures markets? Here we discuss all the mechanics behind transactions, specific requirements ect. Note: We are not talking about strategy yet!

Module 3: Finding Additional Information
How to find additional information about Futures e.g. contract specifications, price information etc. We included our own comprehensive Commodities List as a bonus!

Module 4: What Are Options?
Welcome to the world of options! Let's find out what they are and jump into some important terminology.

Module 5: Trading In Options
Discover how options are traded with all the unique buying and selling combinations that they offer.

Module 7: The Greeks
The Greeks!? What are they and how do they influence option pricing?

Module 8: Fear and Greed
We introduce you to the position graph and discuss the pros and cons of being a buyer versus a seller of options.

Module 9: Options Trading Strategies
Explore all the possibilities with which you can develop options strategies to engage in any market condition.

Module 10: Risk vs. Reward
How to visualize your risk and potential reward using a graph.

Module 11: Implied Volatility
What is Implied Volatility and how to use it to measure market sentiment?

Module 12: Course Summary
We review what was covered in this course thus far before we move on to the practical application of trading options.

Module 13: Theory vs. Practice Part 1

Module 14: Theory vs. Practice Part 2

Module 15: Theory vs. Practice Part 3

Module 16: Theory vs. Practice Part 4

Module 17: Theory vs. Practice Part 5

Module 18: Trading Strategies  Trending Markets

Module 19: Trading Strategies  NonNeutral Markets

Module 20: Trading Strategies  Neutral Markets

Module 21: Trading Strategies  Synthetic Options

Module 22: Starting Your Own Trading Business

Module 23: Course Completion

Module 24: Interpreting and Implementing Our Trade Ideas (Newsletter Service Members)
We discuss guidelines on interpreting and implementing our trade ideas for course students interested in joining our newsletter service.
Terminology Recap
Each option has a specific strike price and when someone buys an option, he/she is paying a premium for that option. The premium paid is for “the chance that the underlying will reach (or possibly exceed) the strike price” and for the risk that something can happen.
Have a look at the price graph we have shown and discussed before.
When you wanted price insurance for a strike price of 77 (position 4) and the price of the underlying market was actually trading at around 75.2, then 77 was relatively far above that price. The premium that the insurance broker charged you for the option was for “the chance that the price could reach and then go above a price of 77” in the allowed time.
The actual option, right at that point in time, was worthless and held no value and if that option expired at the point in time when price was trading at 75.2, then you would not have been able to do anything with it. It would also not have been possible to buy the underlying market at the price of 77 either, but you could have bought it at 75.2.
So right at the moment that you bought the option, it was worth nothing. The premium that you paid was only for “the chance that the price COULD move up and go above 77” – in other words, you were paying for the risk that the broker was taking in giving you insurance.
Now compare the above to a Call option at a strike price of say 73 (position 1). If you opted for the strike price of 73, then that option would have already had a lot of value in it and if you decided to exercise it before expiry (at a price of 75.2), it would mean that you would have bought the underlying market at the strike price of 73!
Let’s look at that again. If you bought at 73 and immediately sold when the price was trading at 75.2, then you would have realized an immediate profit of (75.2 – 73) = 2.2 points of profit.
Depending on the value of the underlying market e.g. Crude Oil, then one point is valued at $1,000 and 2.2 points = $2,200 profit! BUT, it ALSO had the same amount of time to move higher in price than your 77 strike option had. So, if you wanted the insurance broker to sell you THIS insurance premium instead, then he would have to consider that there was already some value in the option PLUS there was also value associated with the time left until the option expires!