Options Trading Strategy & Education
Options offer alternative strategies for investors to profit from trading underlying securities. Learn the basic options strategies such as calls, puts, covered calls, and protective puts.
![Woman looking at a chart on a mobile platform](https://www.investopedia.com/thmb/qOp-skB2BN0Fpvhn5Aishco2S7A=/6000x4000/filters:no_upscale():max_bytes(150000):strip_icc()/GettyImages-1449941379-0d1648128cc4475a91d68f30206a404a.jpg)
Buying vs. Selling Options: Which Is Riskier?
![An Investor looks at monitors tracking prices of securities.](https://www.investopedia.com/thmb/vZwjHdTd_Zv_SJdwXQF_3yIDRyk=/5000x3334/filters:no_upscale():max_bytes(150000):strip_icc()/GettyImages-1258262909-e62980a2a7444e0e838a448b97744362.jpg)
How Options Are Priced
![Bull Call Spread](https://www.investopedia.com/thmb/b6oXbBSSPImj61uABGRl5xxZRGI=/1500x1003/filters:no_upscale():max_bytes(150000):strip_icc()/bullcall-spread-4200210-1-blue-759c3882be664370823655c8d7ac9bb5.jpg)
Bull Call Spread: How this Options Trading Strategy Works
![Credit Spread: The difference in yield between two debt securities of the same maturity but different credit quality.](https://www.investopedia.com/thmb/TL5xYj6QG4n4qE5_S3UHsHqSLSg=/4000x2700/filters:no_upscale():max_bytes(150000):strip_icc()/creditspread.asp-final-b0de117002174da5b6c62c3069181a8f.jpg)
Credit Spread: What It Means for Bonds and Options Strategy
![Spread: The difference or gap that exists between two prices, rates, or yields.](https://www.investopedia.com/thmb/TOLH5iyr5vsjTwaEq-wgzICPjlE=/4000x2700/filters:no_upscale():max_bytes(150000):strip_icc()/spread.asp_final-406ca3c1e1fc4d26a9da063de696a7b1.png)
Spreads in Finance: The Multiple Meanings in Trading Explained
![Stock Option](https://www.investopedia.com/thmb/Nbz131tIYCAYhKImyoSsOnUWi_o=/1500x1000/filters:no_upscale():max_bytes(150000):strip_icc()/StockOption_source-7a5ecb0c22a04d759e283596e7e64905.jpg)
What Are Stock Options? Parameters and Trading, With Examples
![Volatility](https://www.investopedia.com/thmb/_CnhIv5wYv2k_J0e7_W9GjzY0v4=/1500x1000/filters:no_upscale():max_bytes(150000):strip_icc()/Volatility-89fb205b705c493ba02c00a3fc4964cd.jpg)
Volatility: Meaning in Finance and How It Works With Stocks
![A man uses a phone to look at trading data](https://www.investopedia.com/thmb/G2jTCMia6TaPdKhQigX4c0fV9ns=/6000x4000/filters:no_upscale():max_bytes(150000):strip_icc()/GettyImages-1303135611-53c98007ad1948a5a0f7d9e7a919e5ad.jpg)
Why Trading Volume and Open Interest Matter to Options Traders
![LEAPS](https://www.investopedia.com/thmb/StK2El7CAa8wEQJocuY-flW_vGg=/1500x1003/filters:no_upscale():max_bytes(150000):strip_icc()/LEAPS-4193794-1-blue-45190d0bd2d54985aff7809ff2c64a7e.jpg)
LEAPS: How Long-Term Equity Anticipation Securities Options Work
![](https://www.investopedia.com/thmb/aEss32FqkQ_yb9-GFMBJduwiZbE=/2797x1920/filters:no_upscale():max_bytes(150000):strip_icc()/95528215-5bfc2b71c9e77c002630606b.jpg)
4 Ways to Trade Options
![](https://www.investopedia.com/thmb/0KZNn6pasSDDpFL8x0d9GdOpvJ0=/680x440/filters:no_upscale():max_bytes(150000):strip_icc()/122582497-5bfc2b8d46e0fb005119b24b.jpg)
At the Money (ATM): Definition & How It Works in Options Trading
![](https://www.investopedia.com/thmb/hws2VppeTITjuHQknDn78gFRK9I=/680x440/filters:no_upscale():max_bytes(150000):strip_icc()/77005273-5bfc2b8d4cedfd0026c11921.jpg)
Buy to Open: Definition, What It Means in Trading, and Example
![Hand of a Stockbroker Buying and Selling Shares Online](https://www.investopedia.com/thmb/Q43xnohwfSp7HEkb_vVhnEn-4uU=/1500x1082/filters:no_upscale():max_bytes(150000):strip_icc()/GettyImages-932632502-8ba149eee44f4078a35003992add6ca5.jpg)
American vs. European Options: What's the Difference?
![A trader at the New York Stock Exchange sits in front of several computer screens with stock charts](https://www.investopedia.com/thmb/PQUvxTKEaC1Nq70pcZGTa20Avug=/7279x4853/filters:no_upscale():max_bytes(150000):strip_icc()/GettyImages-1433196647-43f492a8118442e8b70f8658d2d0cec3.jpg)
Short Selling vs. Put Options: What's the Difference?
![Stock options](https://www.investopedia.com/thmb/xwqiBOuVxcpvs4VSgp2Wx5zrERs=/1200x800/filters:no_upscale():max_bytes(150000):strip_icc()/stock-options-95bbbbc29b59405aba8e1bd2b3cb6e58.jpg)
In the Money vs. Out of the Money: What's the Difference?
![](https://www.investopedia.com/thmb/9MP71T6tJVu54nuGxxKwM1_NRWs=/285x260/filters:no_upscale():max_bytes(150000):strip_icc()/options-lrg-4-5bfc2b2046e0fb0051199e91.jpg)
Put-Call Ratio Meaning and What It Says About How to Gauge the Market
![Options Trading](https://www.investopedia.com/thmb/hmNec5T5zFcjP2b1V_a0SNthq7w=/1920x1280/filters:no_upscale():max_bytes(150000):strip_icc()/euro-447209_1920-19bd4d41311d4e8987294628997c879d.jpg)
How Is a Put Option Exercised?
![](https://www.investopedia.com/thmb/0KZNn6pasSDDpFL8x0d9GdOpvJ0=/680x440/filters:no_upscale():max_bytes(150000):strip_icc()/122582497-5bfc2b8d46e0fb005119b24b.jpg)
Excersise Price: Overview, Put and Calls, In and Out of The Money
![](https://www.investopedia.com/thmb/RpOgRc6lgf94bS0MKKhktuH3hqI=/680x440/filters:no_upscale():max_bytes(150000):strip_icc()/139085474-5bfc2b8d46e0fb0026016ee7.jpg)
Leg: Definition in Trading, How It Works, and Strategy Types
![](https://www.investopedia.com/thmb/4Dk4ovPv46fjGMqJRVJzfTb5O3M=/680x440/filters:no_upscale():max_bytes(150000):strip_icc()/78289438-5bfc2b8d46e0fb00260b2401.jpg)
Protective Put: What It Is, How It Works, and Examples
![Rights Offering (Issue)](https://www.investopedia.com/thmb/SHA0oXpVrzdicGjzlT8Tx60foY4=/1500x1000/filters:no_upscale():max_bytes(150000):strip_icc()/rightsoffering-Final-425cc283cba942e6b122a4b096093c7c.jpg)
Rights Offering (Issue) Definition, Types, Pros and Cons
![A trader holding the wrong side of an options contract holds their head in despair as a computer screen shows the underlying stock in a sharp decline.](https://www.investopedia.com/thmb/1QKOcxjA5tYo6FPLbmfRRzZRvCM=/6000x4000/filters:no_upscale():max_bytes(150000):strip_icc()/WhatIsaShortCallinOptionsTradingandHowDoesItWorkGettyImages-1316914724-ea2dc35943344efbbd4267be98deb191.jpg)
What Is a Short Call in Options Trading, and How Does It Work?
![](https://www.investopedia.com/thmb/VWqHBE436uG6oOqBr8l2Hznr9tw=/285x260/filters:no_upscale():max_bytes(150000):strip_icc()/options-lrg-3-5bfc2b2046e0fb005144ca9d.jpg)
A Beginner’s Guide to Call Buying
![](https://www.investopedia.com/thmb/9MP71T6tJVu54nuGxxKwM1_NRWs=/285x260/filters:no_upscale():max_bytes(150000):strip_icc()/options-lrg-4-5bfc2b2046e0fb0051199e91.jpg)
Using the 'Greeks' to Understand Options
![Women Are Sitting Thinking and Writing With Pen and Open Notebook in Cafe](https://www.investopedia.com/thmb/nHS80VVcXjFHI58N53t0bA8JnCg=/1500x1000/filters:no_upscale():max_bytes(150000):strip_icc()/GettyImages-1071441340-4d68c8284130403aab20b55138b896a4.jpg)
Introduction to Put Writing
![](https://www.investopedia.com/thmb/1ArWNG_1oCr_Z6x2t9nVoOwDYYA=/680x440/filters:no_upscale():max_bytes(150000):strip_icc()/78293570-5bfc2b8cc9e77c0026b4f8e9.jpg)
American Option Definition, Pros & Cons, Examples
![](https://www.investopedia.com/thmb/hws2VppeTITjuHQknDn78gFRK9I=/680x440/filters:no_upscale():max_bytes(150000):strip_icc()/77005273-5bfc2b8d4cedfd0026c11921.jpg)
Deep in the Money: Definition and How They're Used in Trade
![](https://www.investopedia.com/thmb/4Dk4ovPv46fjGMqJRVJzfTb5O3M=/680x440/filters:no_upscale():max_bytes(150000):strip_icc()/78289438-5bfc2b8d46e0fb00260b2401.jpg)
Interest Rate Options: Definition, How They Work, and Example
![Trading floor at witching hour](https://www.investopedia.com/thmb/hmF_UJRoQfVHz2RvFEInfdmCAyo=/3032x2008/filters:no_upscale():max_bytes(150000):strip_icc()/GettyImages-72382788-9785c2f5f9d44000b0bf6f1c5c9cab58.jpg)
Triple Witching: Definition and Impact on Trading in Final Hour
![Options Contract](https://www.investopedia.com/thmb/A5XIYUQ7GecPvD66CrVTRzwsYo0=/4000x2700/filters:no_upscale():max_bytes(150000):strip_icc()/optionscontract.asp-FINAL-369818cf68054f9eb1b4139dd3a413e7.png)
Options Contract: What It Is, How It Works, Types of Contracts
![spx.jpg](https://www.investopedia.com/thmb/2F8APtvvnbtw0LOLV-dRHEg5OG4=/520x350/filters:no_upscale():max_bytes(150000):strip_icc()/spx-56a6d20d3df78cf7729067dd.jpg)
Call: Definitions in Finance, Call Options & Call Auctions
![An options trader in a co-working space looking at a laptop exploring the values of various stock options and the time remaining on the contracts.](https://www.investopedia.com/thmb/OQwdNNPY6Dk_tHmfg2HHxpcfve8=/7952x5304/filters:no_upscale():max_bytes(150000):strip_icc()/TimeValue-6bf165825d29469f8857c0a112ea2451.jpg)
Time Value: Definition, Role in Extrinsic Value, and Calculation
![Business Planning](https://www.investopedia.com/thmb/dRCGILu_5a6kixTt51Uc4_oPX0s=/1500x1000/filters:no_upscale():max_bytes(150000):strip_icc()/GettyImages-175599141-fc37a453b5dd4839beec3f691484dc4c.jpg)
Interest Rate Call Option: What it is, How it Works, Example
![](https://www.investopedia.com/thmb/pOF0MNRr6SUy2mr14pjqZbb0JcE=/205x136/filters:no_upscale():max_bytes(150000):strip_icc()/options-lrg-2-5bfc2b20c9e77c005143deb4.jpg)
How Long Is an Options Expiration Cycle?
![](https://www.investopedia.com/thmb/0KZNn6pasSDDpFL8x0d9GdOpvJ0=/680x440/filters:no_upscale():max_bytes(150000):strip_icc()/122582497-5bfc2b8d46e0fb005119b24b.jpg)
Synthetic Forward Contract: Definition, How It Works, Example
![Investor viewing company share price market data on a laptop computer](https://www.investopedia.com/thmb/bbNM2G-jaPunAzkIzFX3R8Dwd_I=/5500x4125/filters:no_upscale():max_bytes(150000):strip_icc()/investor-viewing-company-share-price-market-data-on-a-laptop-computer-713768437-c4eda9ee28224ad6be4f6912822227af.jpg)
Using Open Interest to Find Bull/Bear Signals
![](https://www.investopedia.com/thmb/hws2VppeTITjuHQknDn78gFRK9I=/680x440/filters:no_upscale():max_bytes(150000):strip_icc()/77005273-5bfc2b8d4cedfd0026c11921.jpg)
Exercise: Definition and How It Works With Options
![Charting stocks](https://www.investopedia.com/thmb/5VoVnpg9Zf8HRST_ZeFUBk6t4pk=/1920x1078/filters:no_upscale():max_bytes(150000):strip_icc()/chart-1905224_19201-b711b1bb0a874ebf809a19761d05902d.jpg)
Is It Possible to Trade Forex Options?
![Smartphone on a table showing financial data with papers on the table showing pie charts](https://www.investopedia.com/thmb/hDk7UBRQC0WlLx43KvoSzOIp-ak=/2127x1410/filters:no_upscale():max_bytes(150000):strip_icc()/GettyImages-1169678734-b9386f740a4447d5bf17e14cf7fa0613.jpg)
SPAN Margin: Definition, How It Works, Advantages
![](/static/2.84.0/images/placeholder.jpg)
Zero Cost Collar: Definition and Example
![Investor using a tablet and computer screen to trade assets](https://www.investopedia.com/thmb/Hq5kU-w9hWUdd-UedvQ0fKDXy0c=/6000x4000/filters:no_upscale():max_bytes(150000):strip_icc()/INV_Spot_Bitcoin_ETF_GettyImages-1403384080-6cd708eb9a28449db2b17233ac239532.jpg)
Index Option: Option Contracts Based on a Benchmark Index
![A trader monitors offers in the Standard & Poor's 500 stock index options pit at the Chicago Board Options Exchange](https://www.investopedia.com/thmb/5joaKoLcqf1eDlq23WN1oWgvDGo=/3000x2000/filters:no_upscale():max_bytes(150000):strip_icc()/GettyImages-485109234-34e3e03d55564a579688cd96068af669.jpg)
Quadruple (Quad) Witching: Definition and How It Impacts Stocks
![Woman staring thoughtfully at a computer monitor](https://www.investopedia.com/thmb/QBA4jH0i1r9K_Z_hMiaqqdMJS78=/7008x4672/filters:no_upscale():max_bytes(150000):strip_icc()/GettyImages-2158624460-95271fb1d63c4ef88c9da709f8ce6183.jpg)
What Is Early Exercise? Benefits to Selling a Call Option Early
![Stock trader on the floor of the New York Stock Exchange.](https://www.investopedia.com/thmb/HjhtYkThaj4x3WC51YeOKtRnHFI=/3000x1997/filters:no_upscale():max_bytes(150000):strip_icc()/GettyImages-1021285048-5565d696c9fe4e4eb523ce1d2170b3bf.jpg)
Options Trading Strategies: Understanding Position Delta
![](https://www.investopedia.com/thmb/owovJtiL0OTv1hy6iUa6KWmiFp0=/285x260/filters:no_upscale():max_bytes(150000):strip_icc()/options-lrg-5bfc2b1f4cedfd0026c10437.jpg)
Implied Volatility: Buy Low and Sell High
![Buy-Sell Challenge](https://www.investopedia.com/thmb/NCtpLPUNy5VYjKagDHQ_3uUrEEA=/1920x1357/filters:no_upscale():max_bytes(150000):strip_icc()/stock-exchange-911608_1920-10d732f18b394e489f017932acd95d10.jpg)
How to Sell Put Options to Benefit in Any Market
![multi-colored balloons bunched together](https://www.investopedia.com/thmb/3jf4YGFym0vTTZbJO50SlG-BE5g=/2028x1479/filters:no_upscale():max_bytes(150000):strip_icc()/GettyImages-1171494550-194afb7f6989462cb2173ee739cea72a.jpg)
Balloon Option: What It is, How It Works
![](https://www.investopedia.com/thmb/-zhhJkjtdWtM7LtIDUo_mY1vSq8=/680x440/filters:no_upscale():max_bytes(150000):strip_icc()/thinkstockphotos_80410231-5bfc2b97c9e77c0026b4fb20.jpg)
Top 7 Mistakes When Trading in Cheap Options
![](https://www.investopedia.com/thmb/0KZNn6pasSDDpFL8x0d9GdOpvJ0=/680x440/filters:no_upscale():max_bytes(150000):strip_icc()/122582497-5bfc2b8d46e0fb005119b24b.jpg)
Eurex: What it is, History, Trading Technology
![Close-up of stock ticker numbers with green (up) and red (down) arrows](https://www.investopedia.com/thmb/1ArWNG_1oCr_Z6x2t9nVoOwDYYA=/680x440/filters:no_upscale():max_bytes(150000):strip_icc()/78293570-5bfc2b8cc9e77c0026b4f8e9.jpg)
Put Calendar: What It Is, How It Works, Example
![Delta Hedging: An options strategy that seeks to reduce the directional risk associated with price movements in the underlying asset.](https://www.investopedia.com/thmb/1LkZO_vrDw3MlGKJ4E_8CdTWJd0=/4000x2700/filters:no_upscale():max_bytes(150000):strip_icc()/deltahedging.asp-final-0f7419fd8d574f35a8db99c1339fec37.png)
Delta Hedging: Definition, How It Works, and Example
![](https://www.investopedia.com/thmb/1ArWNG_1oCr_Z6x2t9nVoOwDYYA=/680x440/filters:no_upscale():max_bytes(150000):strip_icc()/78293570-5bfc2b8cc9e77c0026b4f8e9.jpg)
Risk Reversal: Definition, How It Works, and Examples
![Business success and growth concept.Stock market business graph chart on digital screen.Forex market, Gold market and Crude oil market .](https://www.investopedia.com/thmb/rIorxbvuIOVFTCTR4rEzlOrDarA=/5315x3543/filters:no_upscale():max_bytes(150000):strip_icc()/business-success-and-growth-concept-stock-market-business-graph-chart-on-digital-screen-forex-market--gold-market-and-crude-oil-market---1137583127-d34773504e394168bcaca53c7b018834.jpg)
Options Industry Council (OIC): What It is, How it Works
![Woman checking stock market charts on a computer monitor](https://www.investopedia.com/thmb/8iUiL3WynDz4AR60MTpbTu06Goc=/6000x4000/filters:no_upscale():max_bytes(150000):strip_icc()/INV_CryptoStocksTrading_GettyImages-1453648525-109e0a68c3064f9a9bdbddc3de638a18.jpg)
Benefits of a Covered Call ETF
![](https://www.investopedia.com/thmb/0KZNn6pasSDDpFL8x0d9GdOpvJ0=/680x440/filters:no_upscale():max_bytes(150000):strip_icc()/122582497-5bfc2b8d46e0fb005119b24b.jpg)
What Is a Naked (Uncovered or Short) Put and How Does It Work?
![Two traders work on the floor of the New York Stock Exchange in front of stock charts](https://www.investopedia.com/thmb/2AlZTw_qD2hdVlT0xxhkbGd9_9A=/8192x5464/filters:no_upscale():max_bytes(150000):strip_icc()/GettyImages-1447167892-6f0e10826b324a6a956eb12731ccff1b.jpg)
A Guide to Trading Binary Options in the US
![Intrinsic Value](https://www.investopedia.com/thmb/qHiuNdhsLopDLgpupR6CNqq7r-4=/1500x1003/filters:no_upscale():max_bytes(150000):strip_icc()/intrinsicvalue-11e4051f0881435d91c0df4f68e9395e.jpg)
Intrinsic Value Defined and How It's Determined in Investing and Business
![](https://www.investopedia.com/thmb/m4FJSBtdBbY-5m3hPwSri0YG66c=/680x440/filters:no_upscale():max_bytes(150000):strip_icc()/122574802-5bfc2b8d46e0fb0026016ef5.jpg)
Assignment: Definition in Finance, How It Works, and Examples
![Close-Up Of Stock Market Data On Digital Display](https://www.investopedia.com/thmb/BPVOW2HX0xaS9w10BB0kp81JmGo=/2120x1414/filters:no_upscale():max_bytes(150000):strip_icc()/close-up-of-stock-market-data-on-digital-display-1058454392-9e48e65462e14a04a74008cbe0ec9aa9.jpg)
The Basics of Covered Calls
![Woman planning her finances on a laptop](https://www.investopedia.com/thmb/0FUtumF0FSXncIWbGdPuKke1kPU=/2121x1414/filters:no_upscale():max_bytes(150000):strip_icc()/Traders-1f2540b1c37c435d852b4424a2bbaf77.jpg)
Put Option vs. Call Option: When to Sell
![Put-Call Parity](https://www.investopedia.com/thmb/IklCAq0aqu8ig0q1l4Frcl-l5B0=/1500x1000/filters:no_upscale():max_bytes(150000):strip_icc()/putcallparity-resized-269114ef81d042fe90ca36a28a6632d5.jpg)
Put-Call Parity: Definition, Formula, How it Works, and Examples
![Stock percentages](https://www.investopedia.com/thmb/q-6WM1BLPhu1-wyc3-V4_4AaBUg=/1920x1439/filters:no_upscale():max_bytes(150000):strip_icc()/stock-exchange-1222518_1920-887599fb37954dbc81819ab566193995.jpg)
What Is Delta in Derivatives Trading, and How Does It Work?
![](https://www.investopedia.com/thmb/RpOgRc6lgf94bS0MKKhktuH3hqI=/680x440/filters:no_upscale():max_bytes(150000):strip_icc()/139085474-5bfc2b8d46e0fb0026016ee7.jpg)
Buy-Write Definition, Strategy, How It Works, Examples
![](https://www.investopedia.com/thmb/UatERCiU5FGnvDW_7sWXDKp0hUE=/680x440/filters:no_upscale():max_bytes(150000):strip_icc()/71017529-5bfc2b8dc9e77c0026b4f91d.jpg)
What Is a Naked Option? How Naked Calls and Puts Work
![](https://www.investopedia.com/thmb/lQtFALhveoeNslITeG-8ZbfC5A8=/680x440/filters:no_upscale():max_bytes(150000):strip_icc()/thinkstockphotos-475654220-5bfc34e046e0fb0051bf96f7.jpg)
Oil Volatility and How to Profit From It