The strike price is the price at which a put or call option can be exercised. It's also known as the exercise price. Picking the strike price is one of three key decisions an investor must make when ...

Options are a type of derivative, meaning they “derive” their value from the securities they’re linked to. Options are also leveraged, meaning a smaller amount invested in them generates larger gains ...

What Is a Stock Option? A stock option is a contract giving its holder the right, but not the obligation, to buy or sell a stock at a given price before a specific date. There are two main types of ...

Option pricing is calculated using the Black-Scholes model, which takes four influential factors into account: the price of an underlying stock (assuming constant drift and volatility), an option’s ...

In options trading, a roll down changes an option position to a lower strike price, often used when expecting falling prices. Learn how this strategy works.

An option price is the value of an option contract. The option price is determined by the extrinsic and intrinsic value of the option contract. Options are contracts that allow investors to buy or ...