Day 3 Flashcards

1
Q

Very Inflated Single Leg strategiesShort Put (Credit/Bullish)

A

used a lot in pro active investor

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2
Q

Very Inflated Single Leg strategiesShort Put (Credit/Bullish)action/maintenance

A

don’t bother to sell option for less than 25 centsbuy back before experation

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3
Q

Very Inflated Single Leg strategiesShort Put (Credit/Bullish)graph

A
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4
Q

Very Inflated Single Leg strategiesShort Put (Credit/Bullish)data

A
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5
Q

Very Inflated Single Leg strategiesShort Call (Credit/Bearish)

A
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6
Q

Very Inflated Single Leg strategiesShort Call (Credit/Bearish)action/maintenance

A
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7
Q

Very Inflated Single Leg strategiesShort Call (Credit/Bearish)graph

A
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8
Q

Very Inflated Single Leg strategiesShort Call (Credit/Bearish)data

A
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9
Q

options liquidity

A
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10
Q

Parameters to assess liquidity

A
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11
Q

Good vs Bad Liquidity

A

lots of volumelots of open interestlittle spreadis good liquidity

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12
Q

option Selection ParametersExpirationstrike selectionDirectional exposurerisk vs Reward

A

buy for long timesell for short time

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13
Q

activation rule

A
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14
Q

proper use of ordersmeets entryhits stopreaches target

A
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15
Q

5 greeksdeltathetavegagammarho

A
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16
Q

theta

17
Q

interpretation of theta

18
Q

theta correlation

19
Q

theta effect

21
Q

interpretation of vega

22
Q

vega correlation

23
Q

vega effect pt 1

24
Q

vega effect pt 2

25
Q

Gamma

26
Q

Interpretation of Gamma

A

Gamma measures the change in deltaGamma reflects the dynamic leverage effect

27
Q

Gamma correlation

28
Q

Gamma Effect

30
Q

interpretation of Rho