Risks of Options Trading
High Risk for Sellers: Unlimited losses possible.
Complexity: Requires deep understanding.
Time Decay: Options lose value as expiry approaches.
Liquidity Issues: Some contracts may not have enough buyers/sellers.
Over-leverage: Small mistakes can wipe out capital.
Options Pricing
An option’s premium depends on:
Intrinsic Value (IV): Actual profit if exercised now.
Time Value (TV): Extra value due to time left till expiry.
Formula:
Premium = Intrinsic Value + Time Value
Example: Nifty at 20,000
Call @ 19,800 = Intrinsic value 200.
If premium is 250 → Time value = 50.
The Greeks (Advanced Concept)
Options pricing is also affected by "Greeks":
Delta: Sensitivity to price change.
Theta: Time decay effect.
Vega: Impact of volatility.
Gamma: Acceleration of delta.
These help traders understand risks better.
High Risk for Sellers: Unlimited losses possible.
Complexity: Requires deep understanding.
Time Decay: Options lose value as expiry approaches.
Liquidity Issues: Some contracts may not have enough buyers/sellers.
Over-leverage: Small mistakes can wipe out capital.
Options Pricing
An option’s premium depends on:
Intrinsic Value (IV): Actual profit if exercised now.
Time Value (TV): Extra value due to time left till expiry.
Formula:
Premium = Intrinsic Value + Time Value
Example: Nifty at 20,000
Call @ 19,800 = Intrinsic value 200.
If premium is 250 → Time value = 50.
The Greeks (Advanced Concept)
Options pricing is also affected by "Greeks":
Delta: Sensitivity to price change.
Theta: Time decay effect.
Vega: Impact of volatility.
Gamma: Acceleration of delta.
These help traders understand risks better.
Hello Everyone! 👋
Feel free to ask any questions. I'm here to help!
Details:
Contact : +91 7678446896
Email: skytradingmod@gmail.com
WhatsApp: wa.me/7678446896
Feel free to ask any questions. I'm here to help!
Details:
Contact : +91 7678446896
Email: skytradingmod@gmail.com
WhatsApp: wa.me/7678446896
Penerbitan berkaitan
Penafian
Maklumat dan penerbitan adalah tidak dimaksudkan untuk menjadi, dan tidak membentuk, nasihat untuk kewangan, pelaburan, perdagangan dan jenis-jenis lain atau cadangan yang dibekalkan atau disahkan oleh TradingView. Baca dengan lebih lanjut di Terma Penggunaan.
Hello Everyone! 👋
Feel free to ask any questions. I'm here to help!
Details:
Contact : +91 7678446896
Email: skytradingmod@gmail.com
WhatsApp: wa.me/7678446896
Feel free to ask any questions. I'm here to help!
Details:
Contact : +91 7678446896
Email: skytradingmod@gmail.com
WhatsApp: wa.me/7678446896
Penerbitan berkaitan
Penafian
Maklumat dan penerbitan adalah tidak dimaksudkan untuk menjadi, dan tidak membentuk, nasihat untuk kewangan, pelaburan, perdagangan dan jenis-jenis lain atau cadangan yang dibekalkan atau disahkan oleh TradingView. Baca dengan lebih lanjut di Terma Penggunaan.