Beginner · 6 lessons · about 24 min

Options 101

Calls, puts, strikes, expirations and the Greeks in plain language. You need this before reading flow.

  1. 01Calls & putsA call gives you the right to buy 100 shares at the strike price before expiration. A put gives you the right to sell 100 shares.
  2. 02Strike & expirationThe strike is the price at which you'd buy (call) or sell (put) the shares. A stock at $50 with a $48 call is in the money.
  3. 03Premium & intrinsic valuePremium is the total price of an option. Intrinsic value is how far in the money the option already is.
  4. 04The Greeks, simplyDelta is how much the option's price changes per $1 stock move. An at-the-money call has a delta near 0.50, so a $1 stock move…
  5. 05Implied volatilityImplied volatility is the market's expectation of future price moves, backed out from option prices.
  6. 06IV rankIV rank measures where current implied volatility sits versus its 52-week range.

Educational content only. Not financial advice.