Options Lab

Explore advanced options spreads, learn the mechanics, and use the interactive calculator to model your own trades.

Debit

Bull Call Spread

Bet on a stock going UP. Cap your risk and reduce the cost by selling a higher strike.

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Debit

Bear Put Spread

Bet on a stock going DOWN. Cheaper and safer than buying raw puts.

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Credit

Bull Put Spread

Get PAID to bet a stock will NOT fall below a certain price.

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Credit

Bear Call Spread

Get PAID to bet a stock will NOT rise above a certain price.

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Neutral

Iron Condor

Bet that a stock will stay chopped entirely inside a specific range.

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Income

Covered Call

Hold 100 shares of a stock and sell a Call option against it to generate yield.

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Income

Covered Put

Short 100 shares of a stock and sell a Put option to buffer the short.

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Volatility

Long Straddle

Bet on a MASSIVE move in either direction. You don't care if it goes up or down.

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Neutral

Short Straddle

Bet that a stock will stay PERFECTLY flat. Extremely high risk.

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Volatility

Long Strangle

A cheaper Straddle. Buy an OTM Call and an OTM Put.

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Neutral

Short Strangle

Like an Iron Condor, but with infinite risk. Sell an OTM Call and OTM Put.

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Neutral

Long Call Butterfly

Pinpoint exact prediction. High reward, incredibly low risk.

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Neutral

Iron Butterfly

A tight Iron Condor. Maximize premium if stock stays perfectly still.

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Credit

Jade Lizard

Collect premium with ZERO upside risk.

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Mastering The Greeks

The Greeks are mathematical risk metrics that quantify how an option's price will react to changes in time, volatility, and the underlying asset's price.

Click any card to view its live Black-Scholes curve.

Delta (Direction)

Delta quantifies how much an option's price will fluctuate based on a $1.00 change in the underlying asset. It acts as a probability gauge for the option expiring In-The-Money.

Example: If a call option has a Delta of 0.75, it indicates that for every $1.00 the underlying stock goes up, the option contract will gain $0.75 in value.

Gamma (Acceleration)

Gamma measures the rate of change in Delta. Think of Delta as the option's speed, and Gamma as its acceleration. It tracks how rapidly your Delta will shift during stock movements.

Example: If a call option has a Gamma of 0.10, its Delta will increase by exactly 0.10 for every $1.00 the underlying stock moves in your favor.

Theta (Time Decay)

Theta represents the silent killer for option buyers. It quantifies exactly how much value an option loses purely due to the passage of time as it approaches expiration.

Example: If an option has a Theta of -0.05, its premium will drop by $0.05 (or $5.00 per standard contract) every single day, even if the stock price is flat.

Vega (Volatility)

Vega measures an option's sensitivity to Implied Volatility (IV). It tracks how much the option's price will artificially inflate or deflate based on market fear and expectations.

Example: If an option has a Vega of 0.15, its premium will increase by $0.15 for every 1% spike in the market's implied volatility.

Rho (Interest Rates)

Rho is the least utilized Greek, measuring the option's sensitivity to shifts in the risk-free interest rate (like Federal Reserve rate hikes).

Example: If a LEAPS call option has a Rho of 0.05, its overall value will increase by $0.05 for every 1% increase in the national interest rate.