Master the terminology of modern stock markets, option Greeks, risk management formulas, and trading execution strategies.
Theta decay represents the rate at which an option contract loses its time value as it approaches expiration. Theta accelerates exponentially in the final 30 days before expiry.
Implied Volatility (IV) measures the market's expectation of future price movement in an underlying stock over a specific timeframe, derived directly from option prices.
Delta measures the expected change in an option's price for every $1.00 move in the underlying stock price. It also serves as a proxy for the probability of expiring In-The-Money (ITM).
Assignment Risk is the probability that an option seller (writer) will be obligated to fulfill the contract by buying or selling the underlying stock when the option buyer exercises their rights.
Paper trading is the practice of executing simulated trades using virtual money in real-market conditions to hone strategies, test risk management, and gain experience without financial risk.
