Option Greeks Explained - COMPLETE BEGINNERS GUIDE (Part 4)
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- Опубліковано 19 чер 2024
- 📣 FREE OPTIONS TRADING MASTERCLASS | skyviewtrading.co/43DRbjn
In this video, you’ll learn all about the Option Greeks and how can help you estimate how an option’s price will change in relation to movement of the underlying stock, the passage of time, and changes in market volatility.
#OptionGreeks
#OptionGreeksExplained
#OptionsForBeginners
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🚨 Hey all, thanks so much for the great feedback on these videos! For those of you requesting more content, we put together an Options Trading Masterclass for you, 100% free. We dive further into our strategies and trading style. If you’re interested, check it out here - skyviewtrading.co/43DRbjn
Gytty
What is the best strategy to succeed in the market now for someone with more or less than $9k
You need a pro or someone good at navigating the market. Someone like Jared Brian Watkins
Almost gave up due to constant losses, but Jared turned my luck around
Leveraging market changes is a remarkable talent Jared has
My monthly yield with Jared is crazy high. I finally quit my 9 - 5 last month
In what way will someone get hisguidance
These options videos have been lifesavers. Most on youtube cannot explain it like this.
Thank you so much!
Why even make videos while Sky View Trading is out here making the best options videos out there!
Thanks for the support!
Frr
Your delivery and engagement are incredible! I know these are usually difficult concepts to grasp, but you do such a great job at teaching them!
Thank you so much!
This is an amazing series! You are an exceptional educator. You have the ability to make hard concepts easy to grasp. Thank you!
Wow, thank you so much for the kind words! Keep up the hard work!
@@skyviewtrading I piggy back on this. Im in one of the worlds leading trading groups and our educators can't touch you. This is exceptional work man. It's helped me so much.
As an investor trying to refresh some key concepts, this has been really easy to understand and helpful. Keep it up!
Thank you! Glad it was helpful!
Best description of the greeks I have heard to date. Importantly, you also describe their real world application. Thank you for the free material! Excellent stuff!
Thank you very much for the comment, view, and sub! We appreciate the support!
Another amazing video, clearest explanation I’ve seen anywhere by far. Keep up the good work guys.
Thanks so much 🙂
Agreed!! Im going to go with these lads
Never really understood greeks completely, until i watched this video. Support.
Glad it was helpful, thanks for watching!
Good to see another video from you guys! Was a nice refresher course. Question about theta- does it decay continuously, lets say as each hour passes or is it only the next trading day?
I am so happy I watch this, it makes more sense now. Thank you
Thank YOU!
This is the type of video and explanation of the Greeks I was looking for. Very informative and easy to understand l. Thanks
Thank you for watching! Glad it helped!
I am glad I found your videos, very clearly explained!
Glad it was helpful!
Hello, all the videos were amazing and very knowledgeable. Thank you for making them available for viewing.
Glad you like them!
Great video! Very understandable. I’ve been trading and studying for years. Learned a lot. Thanks!
Glad it helped!
What really made these videos stand out are the real life examples from the option chain. Great work. Thanks.
Glad you like them! Thanks for the kind words!
Your videos are golden!! You explain everything perfectly thanks!!
Thank you so much!
Damn dude well done. Never seen explanations this thorough before
Thank you!
Excellent video!! Clear and precise!
Thank you!
Your videos are amazing! I'm a complete beginner and I've been able to make sense of all the concepts you've explained - thank you so much!
Great to hear! Thanks for watching and for the kind words!
Thank you for the great info, I am just starting to learn about options and you make it look easy, simple and very informative.
Glad it was helpful!
Great videos. Read a few books and watched other videos but got nothing until I watched this series. Thanks!
Thanks for watching! We appreciate the support!
Thank you for clear and informative presentation.
You are welcome!
Great series and concise work. I'm astonished at how much the viewer count drops off as you go further into the videos. People either give up or thing they are ready after one video
Much appreciated! And yes, it's high level stuff so it's not easy to keep up with!
Your videos are the best explanations of options, thanks!
Glad you like them! Thanks for watching!
This is amazing. I really like the way you have presented this. Clean and easy to understand, straight forward. Thank you, this is so well done!!
Always buy shares not options.
There is no spread for retail to make money any more
You used to be a fine ass bomb intelligent woman 👠
Now your just another grifter
Dollar sign AMPE Ampio pharma
Remember the number one thing affected by interest rates are short seller margin
Don't listen to wall st fairy tales
Your here to tax them increase there cost of doing business not be fleeced.
Markets are expanding not contracting
Low floats are salvation.
Study ODum the only on to really ever do it.
Otherwise your gonna be learning worthless T.A or stratagems that requires a 100 thousand dollar account
All markets are indexed since Jack Bogle.
They have to chase the flow of funds.
Some times it's great to be a guppy
Remember all comment sections are now heavily curated wall st. Bets is not organic
Probably martin Martin shkreli brainchild if not Anton shkreli type
Thanks for watching and for the kind words!
Excellent Excellent Excellent Videos...!!!
Thank you so much!
Thanks for the video. Well explained and easy to understand. Keep up the good work,
Thanks for watching!
Thank you so much brother I really like it i have watched so many videos to understand the option Greeks but I understand clearly after watching this video thank you so much bro ( I am from India)
You are most welcome!
Just watched the 4 videos as I will be beginning options next month and for now I’m doing my research and these videos are great!
How is your option journey going?
@@ClipTok69 yea I also wanna know
Yo this guys videos are super duper well done keep up the good work🔥🔥🔥🔥
Thank you so much!
I found this series especially helpful. I was dreading having to watch the greeks vid, but you were able to convey the info very clearly and was surprised to find the video enjoyable. Thanks!
Glad it was helpful! Appreciate the sub!
Oh wow, this just came out today. Great video! I had been looking for a clear and concise explanation and this video really helps.
Thank you! Glad you enjoyed it.
Thank you for the response.
Thanks for watching!
Great videos! loved it!
Thank you!
Thank you for this tutorial, so easy to grasp!😎
Glad it was helpful!
Great videos .,.... amazing 🤩
Thanks so much for the kind words and for watching!
finally something clear thank you
You are welcome! Thanks for watching!
Great content! I had no idea about options trading 3 days ago and now I know the basics! Thanks man!
Happy to help! Thanks for watching!
Great video thanks
Thanks for watching!
Really informative content bro
Appreciate it!
Your explanation is superb 👏
So glad to hear it helped!
I am 17 have been position trading stocks and trading crypto for about a year now , I am completely new to options have been going through this course and it helps me understand so much , my real question is how did y’all learn to study this and get consistent with it ? I take notes but what strategies do y’all recommend to actually knowing it without looking back through your notes
Wow 6 days a go, glad to see another new post. Greeks was long overdue!
More to come!
@@skyviewtrading love your videos, I remember watching them when covid started and knew nothing now look at me go, selling covered calls against my shares and selling puts here and there all properly calculated risks.
luv it!!!
Thanks for watching!
Awesome
Thanks for digging through our channel! Keep up the hard work!
Your videos are the best. Thanks for all the effort. Please explain how to get on the right side of theta? And have the time decay work for you? Thanks
Thanks for the kind words! Theta Decay works for you when you are an option seller. Selling options on entry is what gives you positive theta decay, which benefits from the passage of time. One of our favorite option strategies is the Short Strangle for example, which we have a video on in our channel. Hopefully that makes sense!
the best !!
So glad to hear you enjoyed!
Love it
Thanks for watching!
thx!
You're welcome!
Can you make a video how to day trade options? Like what strike price and expiration dates to pick? I'm really learning alot from your videos. Thank you btw
We have a video in the works on this topic! In the meantime, checkout our video from today on Part 5!
Waiting for your video 🤗😊
Part 5 out now!
Does implied volatility typically increase as you get closer to an earnings report?
Is there a part 5 coming? Its very informative and well told
Part 5 out now on our channel!
@@skyviewtrading it took u a year?
@zopie plays he replied to the comment and he made a part 5...what did you do? FFS🤣
I have a quick question about the theta. The daily price change it starts to count when you buy the option or at the market open and close time?
Great videos! Thank you! Is there a part 5 ?
Just came out today! Check it out!
I’m an options trader. I like to watch trading videos to laugh and remind myself how far I’ve come. This video however is really good. The gentleman recording this video is very trade articulate and it’s a great video unlike most vids on UA-cam. The only thing I would add is if you don’t know how to read charts, none of this stuff is relevant so put the work in learning charts. Never listen to the news and keep emotions at bay 😊
Thanks for the kind words! We do disagree with your last statement on charts a bit though. As neutral option premium sellers we can argue we don't even need to look at a chart to open and close our trades. Everything we need to make decisions can be found from the option chain! We like to say we are trading the probabilities and statistics from an option chain, rather than the opinions and emotions of a stock chart.
@@skyviewtrading yes absolutely! I was taught to trade raw with no indicators. I just look for levels of interest and imbalances. I also traded the FX markets and that’s where I realized indicators and news don’t matter…at least for me and the way I trade. I realized the news always fits the chart. Even the options orders fit the chart too if you understand what I’m saying. A lot of people don’t lol. Good luck trading I hope you make a killing bro 🤝🤙💪🏼🙏
Thinking of buying 16$ call options for September in Amc
Love the video. Im a slow learner so I need to watch it about ten times before I get it. Lol…
You got this!
Small question: if The stock moves up 1 point do I add gamma to delta and then add it to the option price or do I just add delta to the option price then add gamma to delta to find the new delta value for the next change in stock price?
My favorite & Beautiful Video Share/ New member
Stay safe, stay happy,
stay connected🔔🔔 Full ⌚
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It took me a minute to realize that ToS presents your position greeks to represent the actual dollar amount, whereas the Option Chain greeks present it it as the cost per share (so to speak). Once I made that connection the math made much more sense :)
Great catch! Thanks for the watch!
Perfecto
🙌
Because the info was so clear, it seems to me that the first two columns are the first and second derivative of the strike price, wrt...something, not sure what though.
I really appreciate your videos. I've been studying and paper-trading since November 2020, but just ran across Sky View's videos a couple of months ago. I just started trading options in Sept 2021 (two weeks ago) for real on the ToS platform, at least partly thanks to the info I've gleaned from you. Thank you!
Thanks so much! Glad you're here!
May God bless u
You as well my friend!
Nice serie! Will you release other videos?
Just posted a new one today!
Please make video on iron condor live and it's adjustment
We have an iron condor video out! Just search our channel for "Iron Condor" and you should see it!
Waiting eagerly for part 5
Coming soon! Working on a few other projects right now 😎
Part 5 out now!
Best videos so far in explaining options. However, when discussing changes in Greeks value you keep referring to "point" changes but don't you mean "dollar" changes? There is a difference from a change in point vs. a change in dollar? You seem to go back and forth with these descriptions.
Hey, thanks for the kind words and for watching! As for your question, the terms "point" and "dollar" are the same in this case. You will hear people use them interchangeably when chatting about the option market. Hopefully that makes sense!
Thanks...More Clearly Define 1 point??? is it a percent, a dime, a dollar... I had to google it.
1$
What do you mean by 1 point, $1 or 1% increases?
Hello! 1 point would be 1 dollar
Can someone please help me out, I am abit lost. Why does the delta in the SPX example is so high at 8.98. At the start the of the video the example raised was that delta was 0.47 and that every point the underlying stock increase it the value of the option will increase by 47cents and that if we own 1 contract we would make $47. Does that mean that in the SPX example if I had 1 contract of SPX and SPX goes down by 1 point I would make $898 on the option?
When you speak about position Greek in spx in the video that trade is a put ?
Hello! Option Greeks are for example, Delta, Gamma, Theta, And Vega. Both puts and call prices are dictated by the option greeks. Hopefully that makes sense!
Hi @skyViewTrading.
Where do you publish Part 5/6/7/8...?
Where can we get the full videos list? Playlist?
Thank you.
Part 5 out now! Make sure to subscribe and turn on notifications so you get them when we release new videos!
This guy is such a good teacher, i would be keen for him to do a course for me, how can i get in touch
Hey, thanks for the kind words! You can check out our premium service using the link below!
go.skyviewtrading.com/iv-league-training-page-dt?el=whats_next_discord
👍
🙌
robinhood has an extra greek, Rho. what is that?
I have a question that's confusing me if anyone knows the answer, I know a contract represents 100 shares of the underlying stock(usually), so if the Delta is 2.00 and the stock goes up a point would it affect the P/L 2x100 for each share(up $200) or would it just change by $2. And the same question applies for all the other Greeks to.
It would change by $2 as it is reflective of the number of shares you are long or short of the underlying market
Confused. How does theta be positive and earn money as time passes? when value of option should drop as the expiry draws closer.
Can they be used to filter and find good options to trade? Anyone knows any tools or guide lines on how to use Options Greeks for entering a trade either long or short? Kind of what values to look for in each or all of them to enter or exit a trade?
They sure can! We focus on what exactly to look for in our membership courses!
❤️❤️❤️❤️❤️❤️
❤️
Also I thought in 1 options contract it consist of 100 shares. Why in the example @11:35 that by longing 50 share and the price goes up by 1 point = delta being 50
Short strangle on expiration day or iron condor which strategy works better for beginners?
Check out our Iron Condor and vertical spread tutorial videos! I'd start there!
Confused about the difference between gamma and delta. So if the stock goes up one point the delta goes up to whatever the delta says. But is that only on the first point raise? If it raises another point then the delta raises to whatever the gamma estimates? I know it’s all probabilities. Hope that question made sense
Hello! Yes I think the question makes sense. Keep in mind there are many moving parts that are changing with every second the market is moving, but we can generalize what is going on. We start at a certain delta and gamma number. With every 1 point rise in the stock the delta number will change, and the gamma number is telling you the rate at which delta would change. Once the stock is 1 point higher the options will show different delta and gamma numbers and the process restarts. However, in reality the process is continually running with every second the market is moving and changing delta/gamma amongst other greeks.
While these things can be fun to "geek out" on a bit try not to overthink it too much! When we are actually trading, we pay little attention to diving into the greeks like this on every trade. The option greeks just need to be understood from a broad picture view, so don't let them stress you out too much!
Keep on moving forward and learning more!
Anyone else confused about the Position Greeks? I understood the Greeks but was totally lost once it started going over "Position Greeks". I'm still confused about the whole explanation, and how it seemed like the Greeks previously reviewed were inverted? I understand Delta, Gamma, Theta, and Vega but got super lost once Delta was negative, Theta positive, etc. Any clarification would be greatly appreciated. Videos otherwise were awesome!
Same here. Everything was so clear until he went to "Position". However, he did not define "Position".
complicated terms
which greeks stay constant throughout the life of the contract?
Hello! None -- they move as the price of the stock and volatility of the stock moves. The most important being delta, gamma, theta, and vega. Or in "English" we could say direction, directional sensitivity, time, and volatility respectively!
In the last video, you explained that time decay is always working against us because the extrinsic value goes down. Here you mentioned time decay (Theta) is working FOR us, but you didn't explain how or why
When you buy an option (long put and call), time is against you - if you short an option (put and call), time is working in your favor!
Hey, cheers for the educational videos... but aren't you explaining 'Vega' the wrong way round... shouldn't a Vega of '0.1' imply that, if said options price increases by $0.10 then implied volatility would increase by 1%, rather than the other way around as you described.. ?
Hello, and thanks for the kind words! Nope, your explanation is a bit backwards there. Vega is the Greek that measures an option's sensitivity to implied volatility. It is the change in the option's price for a one-point change in implied volatility. Similar to how delta is the change of an options price for a one-point move in the stock's price. Hopefully that helps!
How did you get the -8.98 Delta for the 10 contracts?
Or is that a mistake, and you meant -8.98 Delta for 1 contract and -89.8 Delta for 10 contracts?
I am confused.
Hello! The delta number is given to us from our trading platform. It's the sum/difference of all the deltas of the short strikes and long strikes. For example, if the short put spread of the Iron Condor generated +20 deltas and the short call spread of the Iron Condor generated -29 deltas, the net delta number would be -9 deltas. In the example of the video we had -8.98 deltas with 10 contracts. We noted with 100 contracts we'd have a delta of -89.80. Hopefully that helps!
i didin't understand how would you lose money if the stock price is going up, did you bought a put that spx would go down? is that it?
Hello! The example showed buying 100 shares of stock and also buying 1 put option. The put option can be thought of as a "hedge." When you buy a put you are betting the price of the stock will go down. Your risk is limited to what you pay for the put.
In the example we purchased the put for $500. We assumed that expired worthless and we lost the $500. However, we made $700 on the +100 shares of stock we owned. That's a net profit of $200. Hopefully that helps!
Are the position greeks exclusive of your trading platform?
Hello! No they are not, every trading platform a brokerage has will offer them.
What kind of Greek letter is Vega?
what is the name of the intro/outro song?
"The Only Way is Up" by Martin Garrix & Tiesto
how would time decay make you money at the 10:25 mark i thought you lose money as time passes on?
Good question! We assumed we sold the Iron Condor on entry. Time Decay is working for you as time passes on when SELLING options and option spreads on entry. If we were buyers, time decay would work against us.
I’m still confused about the relationship between Gamma and Delta. Can anyone explain to me?
Delta is how much an options price will change if the stock goes up 1 point... Gamma is how much the DELTA will change if the stock goes up 1 point...
Sickkkk
What's the difference between option theta n position theta
Hello! An individual option will have it's own theta component, and a position that has many options will have a net theta for that position as a whole.