|Title: Trading Options Greeks: How Time, Volatility, and Other Pricing Factors Drive Profits|
Authors: Dan Passarelli
Genres: English, Options
Publishers: Bloomberg Press
Publication Date: 2015-06-13
an option: a contract that gives its owner the right to buy or the right to sell a fixed quantity of an underlying security at a specific price within a certain constraint.
2 types of options
buyer (holder): have a long position
option seller/writer: a short position in the option
Option holders do not receive dividends that would be paid to the shareholders of the underlying stock, nor do they have voting rights
When a trader who is long an option exercises, a trader with a short position gets assigned.
assignment: the trader with the short option position is called on to fulfill the obligation that was established when the contract was sold.
create a short position = a sell-to-open transaction
cover the short position = buy back the option = a buy-to-close order
volume: the total number of contracts traded during a time period. on a one-day basis, week, month, year. 交易多少次, 一个contract可以交易多次.
open interest: the number of contracts that have been created and remain outstanding. A running total. 实际上有多少个volume的contract