Stock moves X amount in $ , so are OTM Option will be worth ????? - Stocks and ETFs Trading | futures io social day trading
futures io futures trading

Stock moves X amount in $ , so are OTM Option will be worth ?????
Updated: Views / Replies:504 / 3
Created: by md1933 Attachments:0

Welcome to futures io.

(If you already have an account, login at the top of the page)

futures io is the largest futures trading community on the planet, with over 100,000 members. At futures io, our goal has always been and always will be to create a friendly, positive, forward-thinking community where members can openly share and discuss everything the world of trading has to offer. The community is one of the friendliest you will find on any subject, with members going out of their way to help others. Some of the primary differences between futures io and other trading sites revolve around the standards of our community. Those standards include a code of conduct for our members, as well as extremely high standards that govern which partners we do business with, and which products or services we recommend to our members.

At futures io, our focus is on quality education. No hype, gimmicks, or secret sauce. The truth is: trading is hard. To succeed, you need to surround yourself with the right support system, educational content, and trading mentors Ė all of which you can find on futures io, utilizing our social trading environment.

With futures io, you can find honest trading reviews on brokers, trading rooms, indicator packages, trading strategies, and much more. Our trading review process is highly moderated to ensure that only genuine users are allowed, so you donít need to worry about fake reviews.

We are fundamentally different than most other trading sites:
  • We are here to help. Just let us know what you need.
  • We work extremely hard to keep things positive in our community.
  • We do not tolerate rude behavior, trolling, or vendors advertising in posts.
  • We firmly believe in and encourage sharing. The holy grail is within you, we can help you find it.
  • We expect our members to participate and become a part of the community. Help yourself by helping others.

You'll need to register in order to view the content of the threads and start contributing to our community.  It's free and simple.

-- Big Mike, Site Administrator

Thread Tools Search this Thread

Stock moves X amount in $ , so are OTM Option will be worth ?????

  #1 (permalink)
Trading for Fun
Trading Experience: Advanced
Platform: NinjaTrader
Favorite Futures: ES,NQ,YM,TF,CL,GC, ZC,ZS,OJ,SB,ZB ,ZN,6E,6B,6N
Posts: 74 since May 2016
Thanks: 110 given, 14 received

Stock moves X amount in $ , so are OTM Option will be worth ?????

I need to go back through the Basics of Options , cause I for the life of me can not remember the following ..... When does an OTM Option begin to make money ? Is it once the Stock Exceeds the Strike price of the OTM option OR will that OTM option begin making Money AS SOON AS the stock starts moving in the direction of your OTM Options ( Calls for Long in this Example ) ?

Say that XYZ stock is trading at $50 and we buy the $60 call for .50 cents . with 3 months till Expiration. If the Stock starts going up , and reaches say $53 in 1 weeks time ( so we still have plenty of time left till Expiration ) ..... How much would our $60 Call now be worth ( roughly ) ?
Do we look at the Delta when we first buy the $60 Call, to tell us what are Option will be worth " Per " $1 that XYZ stocks moves up $1 ( so long as there's enough time left to go till Expiration, so that Time Decay is not a factor ) ? Thanks man for your help . Don't know why I don't know the Answer to this

I'm tryig to make sure I understand how these Way OTM work ( Move up in Price ) in comparison to the amount the stock goes up and we also have plenty of time left till Expiration. I " Think " that when the stock moves up say $3 , that are $60 Call that had say a Delta of .10 when we first bought it , might now be a .30 Delta , and so we are Increasing the Value of our Option , Even WITHOUT the Stock reaching and Exceeding the $60 strike ?

Thanks for the help, I really appreciate it

Reply With Quote
  #2 (permalink)
Quick Summary
Quick Summary Post

Quick Summary is created and edited by users like you... Add FAQ's, Links and other Relevant Information by clicking the edit button in the lower right hand corner of this message.

  #3 (permalink)
Elite Member
Buenos Aires Argentina
Trading Experience: Advanced
Platform: NT, MT4, Sierra
Favorite Futures: S&P, Bonds, Crude, FX
Posts: 250 since Sep 2014
Thanks: 37 given, 241 received

Delta will tell you how much your option will gain or lose in value per 1.00 unit price change. Theoretically, price moving in your direction will always increase value of your option, it just may not be perceivable because if you have a delta of .005, then you're probably not going to have any net gains after theta decay, or more practically, your delta gain will be offset by the theta decay, in which case your unrealized P&L will still be zero or less than zero.

Gamma will tell you how much your rate of change in Delta will go up as price moves up.

So for a grossly overly simplified forecast, if when you bought the option, delta is .10, and the stock has gained three dollars, then you would expect your option to now be worth .30 more than when you bought it (less Theta x the number of days you have owned the option).

Reply With Quote
  #4 (permalink)
Trading for Fun
Trading Experience: Advanced
Platform: NinjaTrader
Favorite Futures: ES,NQ,YM,TF,CL,GC, ZC,ZS,OJ,SB,ZB ,ZN,6E,6B,6N
Posts: 74 since May 2016
Thanks: 110 given, 14 received

Thank you MacroNinja , that makes a lot of sense now.

I'll likely be looking to buy OTM options with 4 - 6 months of time till Expiration , as I am Hoping to get into these Options just before the Moment of a Big Breakout/Breakdown, so that I can realize the full effect of the Delta/Theta measurements remaining Accurate , and not have Time Decay coming into play , to effect what the " Greeks " are telling me

Reply With Quote


futures io > > > > Stock moves X amount in $ , so are OTM Option will be worth ?????

Thread Tools Search this Thread
Search this Thread:

Advanced Search

Upcoming Webinars and Events (4:30PM ET unless noted)

Battlestations! Show us your trading desks w/GFF Brokers ($750 in Prizes)


Trading Preparedness w/GFF Brokers

Jan 22

Similar Threads
Thread Thread Starter Forum Replies Last Post
Finding the underlying stock value of a call option? brags Traders Hideout 13 September 21st, 2015 09:56 PM
Stock Option trading delayed on stock market open Davecor ThinkOrSwim 0 June 17th, 2015 08:12 PM
Delta-Neutral Stock Option Trading calitrader Elite Trading Journals 6 December 19th, 2014 02:22 PM
Is stock/equity a zero sum game? how can the price of stock moves? Azharr Stocks and ETFs Trading 5 February 4th, 2013 03:52 PM
Stock, Option, Futures & FOREX broker? TonyB Reviews of Brokers and Data Feeds 8 November 16th, 2011 08:39 PM

breakout, delta, etf, forecasting, greeks, information, theta, trading

All times are GMT -4. The time now is 04:57 PM. (this page content is cached, log in for real-time version)

Copyright © 2019 by futures io, s.a., Av Ricardo J. Alfaro, Century Tower, Panama, +507 833-9432 WhatsApp Business,
All information is for educational use only and is not investment advice.
There is a substantial risk of loss in trading commodity futures, stocks, options and foreign exchange products. Past performance is not indicative of future results.
no new posts
Page generated 2019-01-22 in 0.27 seconds with 14 queries on phoenix