Introduction to Stock Options

Introduction to Stock Options
Instructor-Led Course
Hours: 24
Duration of Access: 6 weeks
Start Dates: Nov 12, Dec 10, Jan 21, Feb 18
3,830 Students
have taken this course.

Syllabus

A new session of each course starts monthly. If enrolling in a series of two or more courses, please be sure to space the start date for each course at least two months apart.

Week 1

Wednesday - Lesson 01

Are stock options worth your time and effort? You’ll find out in this lesson. We’ll explore where options originated and whether they are as risky as many people say. Then we’ll go over the formal definition of an option, so you’ll understand exactly what you’re dealing with. Finally, we’ll look at some easy-to-understand examples to drive home each element of that definition.

Friday - Lesson 02

What does “GOOG120121C00680000” mean . . . and why should you care? Every investment specialty has its own jargon, and options are no exception. I’ll explain option symbols and other peculiarities in a way that’s easy to understand. By the end of this lesson, you’ll be able to identify any option just by looking at its symbol. We’ll also explore exchange-traded funds (ETFs), which offer exciting option investments you may eventually consider.

Week 2

Wednesday - Lesson 03

One of the most important things to consider before you buy anything is its price. In this lesson, you’ll learn where to find option prices, what they look like, and how to interpret each element in an option pricing chart. You’ll become what I call a good option detective.

Friday - Lesson 04

It’s one thing to know an option’s price, but it’s quite another to know if that price is reasonable and fair. This lesson gets under the hood of option pricing so you understand what contributes to option value. Knowing what makes one option more expensive than another is one of the essentials of option pricing. When you finish this lesson, you’ll understand that some options are overpriced and some are underpriced . . . and you’ll know which are which before you trade.

Week 3

Wednesday - Lesson 05

This lesson introduces you to an easy graphing system that will show what kind of profit or loss may be possible when you trade any option. These graphs bring clarity to even a complex option strategy. Armed with this knowledge, you'll enter any option trade fully aware of potential risks and rewards. You’ll also know precisely where your break-even point is. All this information contributes to a fully informed trading experience.

Friday - Lesson 06

Get ready to learn about your first basic option strategy—the long call. When you finish this lesson, you'll know the best way to profit when you think a stock price is about to go up. You'll also understand which option to buy depending on how bullish you are about that price movement.

Week 4

Wednesday - Lesson 07

This lesson will tell you where options come from and how you can, if you want, create them yourself. How? By selling a call option. This is called naked call writing, and it's one way you can use options to profit when you think a stock price is going to hold steady or drop. You'll learn the risk inherent in this strategy and what it means to be assigned.

Friday - Lesson 08

We'll explore covered calls in this lesson. This strategy involves selling call options on stock you already own. It's a popular way of making a profit even when your stock's price isn't going up. You'll learn the how, when, and why of this essentially conservative strategy in one easy lesson.

Week 5

Wednesday - Lesson 09

Certain options profit when a stock drops. This lesson acquaints you with the put option, which is in many ways the mirror image of the call option. The versatility of the put option impresses many of my students.

Friday - Lesson 10

Few investors know the benefits—much less the in and outs—of selling put options, but this lesson will fully acquaint you with both. Known as writing naked puts, this strategy is also a way to buy stock for less. And there’s something to be said for collecting your profit up front and putting that money to use immediately!

Week 6

Wednesday - Lesson 11

See the beauty of options as you learn about three combination strategies: the bull spread, the bear spread, and the long straddle. This taste of more advanced option strategies may whet your appetite for other, more esoteric combinations—and there are many. After this lesson, you'll have a good sense of how you can use option combo strategies to make profitable trades.

Friday - Lesson 12

This is the lesson that pulls together everything you've learned into one cohesive overview. You'll also learn about market sentiment and examine how it influences which option strategy is appropriate and when. Finally, we'll discuss the concept of risk and how it's an integral consideration for any option investment strategy.


Review

I enjoyed this class immensely, simply because you made it as easy as possible to understand this whole new world of stock options. I enrolled in this course because I wanted to learn more about investing my stock shares, and found another avenue altogether. Thank you very much, Mark. I thoroughly enjoyed the course.

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