An options strike price is the set price at which an option allows you to buy (in the case of a call) or sell (in the case of a put) the underlying asset. Whether your option ends up profitably depends…
An option premium is simply the price of an option contract. Think of it as the cost you pay as the buyer when purchasing a call or put option, or the amount you receive as the seller when you sell…
Naked calls are an options strategy used to generate income by collecting premium, allowing you to generate income when you expect the stock price to stay below a certain level. However, naked calls also carry significant risk, including the potential…
If you’ve ever sold an option and watched the underlying stock dance around your price on expiration day, you’ve probably felt that uneasy feeling. Worrying if the stock will move in your favor or if it will move against you…
Cash secured puts can be a powerful strategy to generate income or buy stocks a discounted price. It’s a popular method for traders looking to manage risk while earning regular income in the form of option premium. What Is a…
Managing risk is a cornerstone of successful trading, particularly when it comes to short options strategies. To enhance your ability to monitor and assess risk, we’ve introduced the Notional Risk metric to the Key Stats section of your dashboard. This…
Average trade profit/loss is how much money you make or lose on each trade, on average. You get it by adding up all your winning trades and all your losing trades, then dividing that total by the number of trades…
Average Daily Profit/Loss tells you how much money you’re making or losing each day, on average, from your trading. It’s a way to see how your trading is performing day-to-day. Average Daily P/L = Total Net Profit or Loss / Number of Trading Days Example 1: Positive Daily Return…
Largest Day Loss shows you the single biggest amount of money you lost in one trading day. It’s the day where you had the worst trading results. Example How It Can Be Used Limitations Setting daily loss limits May be…
Largest Day Gain shows you the single biggest amount of money you made in one trading day. It’s the day where you had the best trading results. Example How It Can Be Used Limitations Recognizing peak performance May result from…