Options field guide
All guides · Page 29
Plain-language guides to earnings, implied volatility, option strategies, target prices, and time decay
706 guides
What happens when an option expires out of the money?
Understand what out-of-the-money expiration means for long and short calls and puts, premiums, worthless contracts, assignment exceptions, hedges, and next-day positions.
Read guideWheel Options Strategy Explained
Learn how the options wheel cycles through cash-secured puts, stock assignment, and covered calls, including downside, capped upside, cost basis, and exit risks.
Read guideWhen will I know if my option was assigned?
Learn when option assignment appears, how OCC and brokers allocate exercise notices, why timing varies for early and expiration assignment, and what positions, cash, shares, and alerts to check.
Read guideWhy is my option order not filling?
Learn why an accepted option order can remain unfilled, including bid-ask position, queue priority, quoted size, multi-leg pricing, sessions, and partial fills.
Read guideWhy was my option order rejected?
Learn how to diagnose a rejected option order by status, approval, buying power, position effect, contract, price, session, and broker risk controls.
Read guideContango vs backwardation in VIX futures: curve, carry, and false signals
Learn how contango and backwardation describe VIX futures prices, how roll return works, and why an inverted curve is not a guaranteed stock-market forecast
Read guideForward Volatility Explained: Extract Risk Between Two Expirations
Learn why forward volatility comes from differences in total variance, how to calculate it between expirations, and what it does and does not predict
Read guideGamma exposure (GEX) explained without treating it as a price forecast
Understand what aggregate gamma-exposure estimates attempt to measure, the dealer assumptions they require, and why models can disagree
Read guideGamma squeeze explained: the feedback loop and the evidence it requires
Understand how short-gamma hedging can amplify a rally, the conditions a gamma squeeze needs, and why call volume alone cannot confirm one
Read guideHow to calculate realized volatility: returns, windows, and annualization
Learn the realized volatility formula, why log returns and annualization conventions matter, and how sampling choices change comparisons with implied volatility
Read guideImplied Correlation and Dispersion Trading Explained
Learn how index variance combines component volatility and correlation, what a dispersion trade isolates, and why weighting and stress regimes matter
Read guideImplied volatility vs. VIX: why the two numbers are not directly comparable
Compare a contract's implied volatility with the VIX Index, including the underlying, horizon, option set, methodology, and decisions each measure supports
Read guideJump Risk in Options: Why Gaps Break Smooth Hedge Assumptions
Understand how price jumps differ from continuous volatility, why delta hedging cannot trade through a gap, and how options price event and tail exposure
Read guideKurtosis and Tail Risk in Options Explained
Learn what kurtosis measures, why normal volatility can understate extremes, how option wings price tail risk, and where samples and hedges can fail
Read guideLocal Volatility vs Implied Volatility: Quote, Surface, and Model
Understand how observed implied volatility differs from a local-volatility state function, how Dupire calibration links them, and why the distinction matters
Read guideMax pain in options: what it calculates and why it is not a price target
Learn how max pain is calculated from open interest, what the number leaves out, and how it differs from pin risk and dealer gamma
Read guideOption volatility skew: why it is not a bearish forecast
Understand why implied volatility differs across strikes, how downside skew and risk reversals are measured, and why expensive puts do not predict a decline
Read guideOptions expected move: formula, accuracy, and interpretation
Learn how expected move is estimated from implied volatility or an at-the-money straddle, what the 68% rule assumes, and how to test its accuracy
Read guideOptions trading for beginners: six things to know before the first trade
A practical first-trade guide to goals, rights and obligations, contract size, price drivers, execution, and expiration risk
Read guideProbability of touch vs expiring ITM vs profit: three different events
Learn why touching a strike, expiring in the money, and finishing a trade profitably require different events, barriers, assumptions, and probability calculations
Read guidePut/call ratio explained: formula, interpretation, and false signals
Learn how volume and open-interest put/call ratios differ, why equity and index ratios need separate baselines, and what can distort the signal
Read guideRisk-neutral probability: why option-implied odds are not forecasts
Understand the pricing probability behind options, how it differs from real-world probability, and why delta and option-implied distributions need careful interpretation
Read guideSticky strike vs sticky delta: how the volatility surface moves with spot
Understand sticky-strike and sticky-delta assumptions, how each moves skew after a spot change, and why the choice can materially alter option scenario P&L
Read guideThe Heston Model and Stochastic Volatility Explained
Learn how the Heston model makes variance random, how mean reversion and spot-variance correlation shape options, and why calibration is not prediction
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