![]() Why should you be able to reap even more benefit than if you owned the stock? The option costs much less than the stock. That’s a little silly when you really think about it. Deltaīeginning option traders sometimes assume that when a stock moves $1, the price of options based on that stock will move more than $1. And as Plato would certainly tell you, in the real world things tend not to work quite as perfectly as in an ideal one. ![]() ![]() Keep in mind as you’re getting acquainted, the examples we use are “ideal world” examples. There is no guarantee that these forecasts will be correct.īefore you read the strategies, it’s a good idea to get to know these characters because they’ll affect the price of every option you trade. NOTE: The Greeks represent the consensus of the marketplace as to how the option will react to changes in certain variables associated with the pricing of an option contract.
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