Options Trading System

Losing money on both sides of a price swing.

Refers to an unusually large spread between the bid and asked prices.

A market index of approximately 6,500 U.S. based equities traded on the American Stock Exchange, the New York Stock Exchange and the NASDAQ stock market.

A day on which two or more classes of options and futures expire.

To sell an option that is not owned through an opening sale transaction. While this position remains open, the writer is subject to fulfilling the obligations of that option contract; i.e., to sell stock (in the case of a call) or buy stock (in the case of a put) if that option is assigned.

An investor who so sells an option is called the writer, regardless of whether the option is covered or uncovered.

A fictitious company used as the underlying stock throughout The Options Toolbox.

A daily publication of the National Quotation Bureau detailing bid and asked prices.

The rate of return on an investment.

The percentage change in an options price per 1% change in implied volatility.