Options
Contingent claims, priced.
Options are contingent claims — the right, not the obligation, to transact. This course teaches the instrument, the greeks, and the defensible household uses.
You will finish able to structure a hedge for a real position and defend the choice in writing.
- 01
Read an options chain.
- 02
Explain Black-Scholes at an intuitive level.
- 03
Structure a defensible hedge.
- — Program II — Investing.
1–2 weeks · ~5 hours plus the Assignment.
- IModule · ~1.5 hours.
The instrument
Right, obligation, and expiration.
Calls and puts and the four fundamental positions.
What You Will Be Able To Do- — Draw the four payoff diagrams.
- — Explain the greeks intuitively.
- — State the four fundamental positions.
Why hereEvery complex options structure decomposes into these four.
- IIModule · ~2 hours.
Pricing
The theory, and its assumptions.
Black-Scholes is the working theory. Its assumptions are as important as its formula.
What You Will Be Able To Do- — State the five inputs.
- — Explain the assumptions.
- — Distinguish implied from realized volatility.
Why hereThe theory decodes what the market is charging.
- IIIModule · ~1.5 hours plus the Assignment.
Strategy
What options are actually for.
The defensible household strategies — covered calls, protective puts, collars.
What You Will Be Able To Do- — Structure a covered call.
- — Structure a protective put.
- — Design a collar for a concentrated position.
Why hereThese three strategies handle 90% of legitimate household options use.
Options are tools, not lottery tickets. Households that treat them as tools do well.