Specialty Modules

Equity LEAPS are listed options with more than nine months, and up to about three years, until expiration. Learn how they are listed, priced and margined.

Stock replacement means buying a deep in-the-money LEAPS call instead of 100 shares. See what it costs, how closely it tracks the stock and what you give up.

LEAPS lose value to time slowly but react strongly to implied volatility. Compare theta, vega and rho for a one-year and a one-month call on the same stock.

Managing a LEAPS diagonal means rolling the short call every few weeks and rolling or closing the LEAPS itself before its last months. See each decision with model prices.

0DTE options expire at the end of the day you trade them. Learn which underlyings list daily expirations, why same-day options look cheap, and how fast they can go to zero.

In an option's final hours, gamma makes delta flip from near zero to near one on small moves, and theta drains what time value is left. See both with numbers.

Same-day sellers cap their risk with spreads. Learn how a 0DTE credit spread and iron condor work, with the maximum profit, maximum loss and break-even of each.

What happens to a same-day option after the closing bell - exercise cutoffs, automatic exercise, cash versus share settlement, pin risk, and how a spread can be assigned.

A cash-settled option pays its in-the-money value in cash at expiration instead of delivering shares. Here is how SPX and other index options settle, step by step.

American-style options can be exercised any day before expiration; European-style options only at expiration. Here is what that changes for buyers and sellers.

SPX and SPXW are both S&P 500 Index options, but standard SPX settles on Friday's opening prices and SPXW on the closing value. Here is why that difference matters.

SPX, XSP and SPY options all track the S&P 500, but they differ in size, settlement, exercise style and dividends. Here is how to tell which one fits a trade.

The special opening quotation, or SOQ, is the settlement value for AM-settled index options like standard SPX. Here is how it is built and why it can surprise you.

Index options end in a cash debit or credit, not shares, so they need a different journal entry at expiration. Here is how to record SPX, SPXW and XSP trades cleanly.

An option on futures gives the right to buy or sell a futures contract at a set price. Learn how futures options work and how they differ from stock options.

Every futures option has its own contract size, quote and tick value. Learn how to read a contract spec and turn a quoted premium into dollars.

Futures options expire on product-specific schedules, often before their futures month. Learn how quarterly, serial and weekly expirations work and which futures each one is on.

Futures option sellers post margin calculated by SPAN, a risk-based system. Learn how SPAN works, why buyers pay the premium instead, and how margin calls happen.

Exercising a futures option gives you a futures position at the strike price, not the commodity. Learn how exercise and assignment work and what they cost in cash and margin.

Sector ETF options are options on funds that hold one industry, so a single contract expresses a view on the whole sector. Here is how they work, why they cost less than single-stock options, and what to check first.

Scheduled macro releases like FOMC decisions, CPI and the jobs report can move the whole market at a known time. Here is when they land, how options price them in advance, and what a straddle needs to work.

A pairs trade bets that one stock will do better than a related stock or its sector. Here is how to build one with options, size both sides, and what the payoff really rewards.

If your portfolio leans heavily on one industry, puts on that sector's ETF can cap the damage from a sector-wide fall. Here is how sector beta sets the hedge size, what it costs, and the basis risk it leaves.

Options trades usually produce capital gains and losses. Here is how the premium is treated for buyers and writers, and what closing, expiring, exercise and assignment each do.

Broad-based index options such as SPX are generally Section 1256 contracts, taxed 60% long-term and 40% short-term and marked to market at year end. Here is which options qualify and how it works.

The wash sale rule can disallow a loss on stock or options when you buy substantially identical stock or securities, or an option to buy them, within 30 days. Here is how options trigger it.

Hedging stock with options can defer losses and change holding periods under the tax straddle rules. Here is how qualified covered calls, protective puts and married puts are treated.

Options trades change stock basis, can be caught by wash sale and straddle rules, and are not always reported in full on a 1099-B. Here is what records to keep and when to bring in a professional.

A testable trading rule is a written condition so precise that a person or a backtest would apply it the same way every time. Here is how to turn entry, exit and sizing ideas into rules you can test.

Backtesting applies a strategy's rules to past market data to see how they would have done. Here is what a backtest can tell you, and the biases that make most backtests look better than reality.

Paper trading is placing simulated trades with no real money at risk. Here is what it is good for when testing an options strategy, what it hides, and how to run it so the results mean something.

Rule adherence is the share of your trades that followed every one of your written rules. Here is how to record it after each trade, count it, and use it to tell a bad rule from a broken one.

Tail risk is the chance of a rare, extreme market move. Learn why big losses are so hard to recover from, why diversification fails in a crash, and how options can cap the damage.

Buying puts on a broad index or index fund can cap a whole portfolio's loss in a crash. Learn how many contracts you need, how to pick the strike, and what the hedge does not cover.

Selling a lower put, a call, or both can pay for part of a portfolio hedge. Learn how put spreads, collars and put spread collars work, and exactly what each one gives up.

A put hedge loses value every quiet day it is held. Learn how to measure the yearly cost of keeping protection in place, how the roll schedule changes it, and what the hedge is worth after a drop.

VIX options pay off on expected market volatility rather than on prices. Learn what the VIX measures, why VIX options price off VIX futures, how they settle, and how a VIX call compares with an index put.