Time Decay in Selling Options

We prove again and again that the selling of options is very beneficial. In selling options we encounter the same elements that affect the options premium as when we buy the option. The components are, time untill the options expire, volatility and the strike price, and theta decay. Strike Price The strike price. The more strike price goes away from the […]

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Sell Premium during Holidays

We like to sell options in order to receive premium. The idea is to sell options with let say 45 days to expiration and that these options expire worthless. In the weekends and holidays people are away from their desk. Traders are taking days off, and companies earnings announcement are delayed. These may be excellent times to sell option premium. […]

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The ABC of selling Options

Learn the ABC of selling options. Investors who trade options has to make many decisions like buying or selling options. Which strategy is best considering the market. What is investors assumption about the stock. If an investor is bullish, she can sell a put, whereas if she is bearish, may sell a call. There are many reasons to choose each […]

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Advantage of weekly options

We want to discover the reasons why traders like to use Weekly Options to generate a consistent income. Until a few years ago there were only regular options, with one of more months to expirations.  We will discuss the benefits of weeklies. This post is meant to be a guide for new traders who doesn’t know much about options and […]

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Time Decay is your best Friend

We benefit from options because of Time Decay. Time decay is represented by a Greek term know as Theta. Don’t worry too much about the Greeks for now, we will take a look at it a later on. Theta is a crucial component for options traders that decide to sell options. They will receive options premium to take on risk. […]

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Importance of Extrinsic Value in Selling Options

The definition of Extrinsic Value is the difference between an option’s market price and its intrinsic value. In theory, options should not trade above their Intrinsic Value due to the time value associated with option pricing. Why is Extrinsic Value important for traders?  We will explain in depth what extrinsic value is. Then we will explain why extrinsic value is […]

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