Course Participants are provided with a brief Options Trading Power Point to cover the essential elements of any Options Trading Discussion. The class is structured to meet the participant’s level of Options Trading Knowledge. The discussion can be for the entire syllabus or individual sessions.

Beginners’ Session:

  • Basic Discussion of Puts and Calls
    • Rights
    • Obligations
    • Strikes
    • Duration
  •  Underlying Contract
    • Understanding in-the-money and out-of-money Options
    • Intrinsic Value
    • Time Value
  • Break Even Points of Simple Strategies
    • Long and Short Calls
    • Long and Short Puts
    • Spreads
  • Understanding the Risk/Rewards of Basic Strategies
    • Long Options
    • Short Options
    • Options Spreads

Intermediates’ Session includes any points not clear in Beginner Session plus:

  • Understanding the Greeks
    • Delta
    • Gamma
    • Vega
    • Theta
  • Implied Volatility
    • Numerical Comparison of Options Prices
    • Comparison to Historical Volatility
    • Effectively comparing Options by Using Implied Volatility
  • Black Scholes Model
    • Discussion of the Nobel Prize Winning Model
    • Why it’s still relevant to today’s Options Markets
    • Where Black Scholes is ineffective
    • Other Models
  • Valuing Options Comparatively
    • Using Implied Volatility
    • Using Butterfly Spreads and Synthetic Positions

Advanced Session includes any discussion from above needing review plus:

  • Understanding the Implied Volatility Skew
    • Different Skews for Different Markets
    • What is the genesis of the Implied Volatility Skew
  • Structuring Positions based on Implied Volatility and the Skew
    • Using the Skew to Design an Options Strategy
    • Analyzing how to create the Appropriate Strategy
    • Defining the proper Strategy to meet one’s goals.
  • Analyzing Risk/Reward Factors
    • Determining the benefits of a Strategy and how it may increase the likelihood of a more profitable outcome
    • Evaluating Hedging and Speculative Strategiesfor managing risk
    • Designing the correct strategy for a specific Risk/Reward Parameter
  • Essential information to review before trading
    • Implied Volatility
    • Historical Volatility
    • Implied Volatility Skew
    • Information Provided in the underlying’s Chart including Relative Strength Index
    • Liquidity Factors
    • Analysis of the Trading Costs Per Thousand Dollars of nominal value
    • Pre-determined Entry and Exit Point

Corporate Sessions:

  • Designed to meet the risk management requirements of corporations and funds, either hedging defined corporate risk or speculating a portfolio, or both
    • Utilizes the factors in the classes above to effectively evaluate the Risk Management requirements of the firm
    • Reviews corporate methodologies of risk management and trading to provide recommendations to meet best practices
  • Analysis of the corporation’s hedging and speculative needs in order to potentially assist in the modification of certain trading methodologies
    • Use Implied Volatility and Skew Analysis to assist in providing potential structure to Hedging and Speculative Positions
    • Design Specific Templates for trading analysis
  • Consulting with Governmental Agencies and Exchanges in risk management and the analytical review of markets, settlements and liquidity issues
  • Discussion of major risk management disasters including the following:
    • Amaranth
    • Volume Investors
    • Klein and Company