Category: Options

What Is A Gamma Squeeze

You may have heard of a so-called short squeeze. In this scenario, an increasing stock price forces market participants who were shorting the stock to buy it back, which in turn drives the stock price higher. A gamma squeeze is similar. But it represents a more complex type of short squeeze, as it’s typically an interaction between purchased options, stocks that are heavily shorted, and the market makers.

Poor Man’s Covered Call Strategy

A poor man’s covered call (also known as a leveraged covered call) is a strategy favored by options traders with small accounts. This is also where the name comes from. Some of you will have heard of the covered call strategy. If not, you should read about this strategy first to better understand the leveraged covered call.

What are LEAP Options?

The term for LEAP options (also called LEAPS) is Long-Term Equity Anticipation Securities. A boring term, I know. But it’s simple and not complicated at all: LEAPS are just normal options (securities) with a very long expiration time. Whereupon “very long” means an expiration time longer than one year. But anything else is practically the same. In this article, we will take a closer look on the whole topic about this type of options and check how to make money in stocks (or even futures) by trading LEAPS.

What is the Options Price Reporting Authority?

Accurate real-time data is essential to the proper functioning of the options market, but it would be tremendously challenging for individual associations to collect and process options market data. Exchanges involved in options trading produce huge amounts of data, far beyond of data than other asset classes generate. In other words: options data traffic produces at least 75% of all market data! This growth in data has caused a seemingly interminable increasing demand in hardware and software for vendors and customers as well. This all by increasing of the operating costs with just a little or even no benefit for the market participants. Hence, a solution has to be developed to address the issue. The solution which was developed has got the name Options Price Reporting Authority (OPRA).

What is a strangle in options trading?

A strangle is one of the very common strategies in options, and every beginner in options trading will learn to know this one (amongst some of the other basic strategies). In this article we are going to answer the question “What is a strangle in options”. Also, we will check the differences between a long and a short strangle, and check which of both strategies is better. So, let’s start!