The Options Forum.
Option Strategy Cheat Sheet.
Addressing a lot of questions I collected below, in condensed form, some key data about option strategies. Only basic strategies are listed to keep these tables to a manageable size. Complex, multileg strategies can be analyzed as combinations of basic strategies. Many listed strategies involve dealing in the underlying stocks - option strategies are often inseparable.
Option Strategies Ranked by Market Outlook (Table 1)
OTM - out of the money ATM - At the money ITM - In the money Phrase buy/sell stock means that following it option strategy can be applied to either new or existing stock positions.
Basic Option Strategies Exposure to Risk (Greeks) (Table 2)
+ Delta means position will make money if stock rises (bullish) + Gamma means Delta will increase if stock rises. + Theta means position makes money from time passage. - Theta means position loses money from time passage. + Vega means position makes money from increased volatility. Rho dropped for brevity 0 means position has no Greek or unaffected.
Put / Call Equivalence (Table 3)
Often referred to as put call parity. This is a relationship between stock, puts and calls which allows to setup bullish positions using puts and vice versa. Such positions are often called synthetic options positions.
Profit and loss graph of positions within each row is the same. The result may not be identical due to interest on cash balances and dividends. This table may be useful in determining if one's objective can be achieved in other ways.

Trading Options For Dummies Cheat Sheet.
Trading options is a bit different from trading stocks, but they both require research and study. If you’re going to trade options, it’s important that you know order types, how to read changes in the market with charts, how to recognize how stock changes affect indexes and options, and how indexes are built.
Trading Order Types.
A variety of order types are available to you when trading stocks; some guarantee execution, others guarantee price. This brief list describes popular types of trading orders and some of the trading terminology you need to know.
Market order: A market order is one that guarantees execution at the current market for the order given its priority in the trading queue (a. k.a., trading book) and the depth of the market.
Limit order: A limit order is one that guarantees price, but not execution. When placing a limit on an order, it will be treated like a market order if:
When buying, your limit is at or above the current market ask price and there are sufficient contracts to satisfy your order (for example, limit to buy at $2.50 when the asking price is $2.50 or lower).
When selling, your limit is at or below the current market bid price and there are sufficient contracts to satisfy your order (for example, limit to buy at $2.50 when the asking price is $2.50 or higher).
Stop order: A stop order, also referred to as a stop-loss order , is your risk management tool for trading with discipline. A stop is used to trigger a market order if the option price trades or moves to a certain level: the stop. The stop represents a price less favorable than the current market and is typically used to minimize losses for an existing position.
Stop-limit order: A stop-limit order is similar to a regular stop order, but it triggers a limit order instead of market order. While this may sound really appealing, you’re kind of asking a lot in terms of the specific market movement that needs to take place. It may prevent you from exiting an order you need to exit, subjecting you to additional risk. If the stop gets reached, the market is going against you.
Duration: The two primary periods of time your order will be in place are.
The current trading session or following session if the market is closed.
Until the order is cancelled by you, or the broker clears the order (possibly in 60 days — check with your broker)
Cancel or change: If you want to cancel an active order, you do so by submitting a cancel order. Once the instructions are completed, you receive a report notifying you that the order was successfully canceled. It’s possible for the order to already have been executed, in which case you receive a report indicating that you were too late to cancel, filled with the execution details. Needless to say, you can’t cancel a market order. Changing an order is a little different than canceling one because you can change an order one of two ways:
Cancel the original order, wait for the report confirming the cancellation, and then enter a new order.
Submit a cancel/change or replace order, which replaces the existing order with the revised qualifiers unless the original order was already executed. If that happens, the replacement order is canceled.
Charts Used for Tracking Investments.
Price data is used in charts to give you a view of market trading activity for a certain period. The following list gives you the lowdown on some of the chart types you might encounter while you track your investments:
Line chart: This chart uses price versus time. Single price data points for each period are connected using a line. This chart typically uses closing value. Line charts provide great “big picture” information for price movement and trends by filtering out the noise from the period’s range data. One advantage to line charts is that more minor moves are filtered out. A disadvantage to line charts is that they provide no information about the strength of trading during the day or whether gaps occurred from one period to the next.
Open-High-Low-Close (OHLC) bar chart: This chart uses price versus time. The period’s trading range (low to high) is displayed as a vertical line with opening prices displayed as a horizontal tab on the left side of the range bar and closing prices as a horizontal tab on the right side of the range bar. A total of four price points are used to construct each bar. OHLC charts provide information about both trading period strength and price gaps. Using a daily chart as a point of reference, a relatively long vertical bar tells you the price range was pretty big for the day.
Candlestick chart: This chart uses price versus time, similar to an OHLC chart with the price range between the open and the close for the period highlighted by a thickened bar. Patterns unique to this chart can enhance daily analysis. Candlestick charts have distinct pattern interpretations regarding the battle between bulls and bears that are best applied to a daily chart. They also incorporate inter-period data to display price ranges and gaps.
How Financial Indexes Are Constructed.
To help understand financial index changes, you should know how indexes are built. Indexes are not created equal (well . . . one is). Financial indexes are constructed in three different ways:
Price-weighted: Favors higher-priced stocks.
Market cap-weighted: Favors higher-cap stocks.
Equal dollar-weighted: Each stock has same impact.
How Changing Stock Affects Indexes.
A financial index is a measuring tool of prices for groups of stocks, bonds, or commodities. A change in one stock translates into index changes. Some examples are:
When a high-priced stock declines in a price-weighted index, it leads to bigger moves down in an index when compared to declines in a lower-priced stock. The Dow is an example of a price-weighted index that is affected more by Boeing (trading near $100) than Pfizer (trading near $25).
A market-cap weighted index, such as the S&P 500, is impacted more by higher market capitalization stocks regardless of price. Even though Microsoft may only be trading at $30 per share, its market cap is huge — about $290 billion. When it moves up or down it creates a greater change in the S&P 500 than, say, Amgen, which trades at $55 per share, but only has a market cap of approximately $64 billion.
All of the stocks in an equal-dollar weighted index should have the same impact on the index value. In order to keep the index balanced, a quarterly adjustment of the stocks is required. This prevents a stock that has seen large gains over the last three months from having too much weight on the index.

Option strategy cheat sheet and best software.
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Option strategy cheat sheet and best software.
Yep, thats a problem for those who seek information for free over the net. But that's what the option industry in the USA want. They are not interested to give away for free such information, as this is part of there profit making. Sell when IV is high and others do not realize it and buy when IV is low. In option share trading this is a real disadvantage for the retailers, specially when they want to trade events. Otm, atm and itm options are in different ways affected from IV. Understanding this in details helps at least a bit. Take care / Stan Dan.
Fortunately, it's a lot better than it used to be. Popular discount brokerages with in-house platforms that include volatility information and some level of scanning and modeling (payoff diagrams) include:
5. Interactive Brokers (they've recently added some "Option Lab" components)
2. Optionistics. About $25/mo. I've looked at this but never subscribed or used the trial.
3. LiveVol which recently added a 'basic' package at about $80/mo or you can sign up for their LiveVol securities and get it for free. The last time I looked, the clearing choices were Interactive Brokers and APEX.
5. Interactive Brokers (they've recently added some "Option Lab" components)
2. Optionistics. About $25/mo. I've looked at this but never subscribed or used the trial.
3. LiveVol which recently added a 'basic' package at about $80/mo or you can sign up for their LiveVol securities and get it for free. The last time I looked, the clearing choices were Interactive Brokers and APEX.
A lot of tools Leinster got now from you and me. But in the final end: All those tools will not make the trade. The outcome of any trade still will depend on our deeper knowledge on any of the option strategies we use/trade, HOW and WHEN any of those tools are used in combination with what the market actually shows on the chart in the time frame our option strategy is implemented. Take care / Stan Dan.
I would be curious to hear how things go with IB's data feed. You can save a lot of money with it compared to buying one of the feeds from OptionVue, but it's also known for having some quirks and being a slow-loader when it comes to options chains. That's the view from the guy that wrote the Hoadley Tools, anyway. He tells people that have an account with both IB and OptionsXpress, to use the OX feed or basically any feed but IB for loading chains.
I use OV and agree on the issue of Data. I tried to use IB quotes at first and had lots of problems with slow or missing prices in OV. After talking to them I switched to feeding OV with quotes from TOS and the problems were solved. I still use IB to trade but if you want to save money on data for OV then go with something other than IB.

Options strategy cheat sheet

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