The Options & Futures Guide

Learn option trading and you can profit from any market condition. Understand how to trade the options market using the wide range of option strategies.

Discover new trading opportunities and the various ways of diversifying your investment portfolio with commodity and financial futures.

To help you along in your path towards understanding the complex world of financial derivatives, we offer a comprehensive futures and options trading education resource that includes detailed tutorials, tips and advice right here at The Options Guide.

Options Strategy Search Engine

Profit graphs are visual representations of the possible outcomes of options strategies. Profit or loss are graphed on the vertical axis while the underlying stock price on expiration date is graphed on the horizontal axis.

A quick way to scan for option trading strategies is by using profit graphs....

Option Basics:
What are Stock Options?

Before you begin trading options, you should know what exactly is a stock option and understand the two basic types of option contracts - puts and calls. Learn how they work and how to trade them for profits.... [Read more...]

Binary Option Basics:
What are Binary Options and How to Trade Them

Binary option trading is quickly gaining popularity since their introduction in 2008. Check out our complete guide to trading binary options.... [Read more...]

Beginner Strategy:
Covered Calls

The covered call is a popular option trading strategy that enables a stockholder to earn additional income by selling calls against a holding of his stock.... [Read more...]

Stock Option Advice:
Buying Straddles into Earnings

Buying straddles is a great way to play earnings. Many a times, stock price gap up or down following the quarterly earnings report but often, the direction of the movement can be unpredictable. For instance, a sell off can occur even though the earnings report is good if investors had expected great results....[Read more...]

Stock Option Trading Basics:
Why Invest with Options?

For the short to medium term investor, stock option investing provide an additional suite of investment options to let him make better use of his investment capital.... [Read more...]

Advanced Concepts:
Understanding Option Greeks

When trading options, you will come across the use of certain greek alphabets such as delta or gamma when describing risks associated with various options positions. They are known as "the greeks".... [Read more...]

Option Trading Advice:
How a Low Commission Broker Can Increase Option Spreads Profits by 50% or more

Many options traders tend to overlook the effects of commission charges on their overall profit or loss. It's easy to forget about the lowly $15 commission fee when every profitable trade nets you $500 or more. Heck, it's only 3% right?.... [Read more...]

Stock Options Advice:
Effect of Dividends on Option Pricing

Cash dividends issued by stocks have big impact on their option prices. This is because the underlying stock price is expected to drop by the dividend amount on the ex-dividend date....[Read more...]

Advanced Concepts:
Put Call Ratio - What It Is and How to Use It

Learn about the put call ratio, the way it is derived and how it can be used as a contrarian indicator.... [Read more...]

Advanced Concepts:
Futures Options Trading

Another way to play the futures market is via options on futures. Using options to trade futures offer additional leverage and open up more trading opportunities for the seasoned trader.... [Read more...]

Stock Option Advice:
Day Trading using Options

Day trading options can be a successful, profitable strategy but there are a couple of things you need to know before you use start using options for day trading.... [Read more...]

Stock Options Tutorial:
Writing Puts to Purchase Stocks

If you are very bullish on a particular stock for the long term and is looking to purchase the stock but feels that it is slightly overvalued at the moment, then you may want to consider writing put options on the stock as a means to acquire it at a discount....[Read more...]

Stock Options Advice:
Leverage using Calls, Not Margin Calls

To achieve higher returns in the stock market, besides doing more homework on the companies you wish to buy, it is often necessary to take on higher risk. A most common way to do that is to buy stocks on margin....[Read more...]

Stock Option Tutorial:
Dividend Capture using Covered Calls

Some stocks pay generous dividends every quarter. You qualify for the dividend if you are holding on the shares before the ex-dividend date....[Read more...]

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The Options Guide

Options Basics

Introduction Call Option Put Option Strike Price Option Premium Moneyness Expiration Exercise & Assignment Getting Started in Options Trading Finding an Options Broker Options Chain Order Entry Options Transactions Types of Orders Margin Requirements Glossary

Futures Basics

Futures Basics Futures Contract Specs Futures Margin Long Futures Position Short Futures Position Long Hedge Short Hedge Understanding Basis

Bullish Strategies

Call Buying Bull Call Spread The Collar Call Backspread Bull Calendar Spread Covered Calls Naked Puts Covered Straddle

Bearish Strategies

Put Buying Bear Put Spread Put Backspread Covered Puts Naked Calls

Neutral Strategies

Ratio Spread The Straddle The Strangle The Butterfly The Condor The Iron Butterfly The Iron Condor Calendar Straddle

Synthetic Positions

Overview Synthetic Long Call Synthetic Long Put Synthetic Long Stock Synthetic Short Call Synthetic Short Put Synthetic Short Stock

Options Arbitrage

Overview Conversion Reversal Dividend Arbitrage

Risk Warning: Stocks, futures and binary options trading discussed on this website can be considered High-Risk Trading Operations and their execution can be very risky and may result in significant losses or even in a total loss of all funds on your account. You should not risk more than you afford to lose. Before deciding to trade, you need to ensure that you understand the risks involved taking into account your investment objectives and level of experience. Information on this website is provided strictly for informational and educational purposes only and is not intended as a trading recommendation service. TheOptionsGuide.com shall not be liable for any errors, omissions, or delays in the content, or for any actions taken in reliance thereon.