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IntraDay Options Trading Education

Options Trading Self-Assessment

Already trading options? Use this form to assess your basic market knowledge (and skip the Investment Current Intro Course.)

Self Assessment Quiz

Have you ever traded Options before?

No, I have no experience with options trading

Yes, I have some experience.

Yes, I have significant experience in options trading.

Have you taken any formal courses or read books on options trading?

I have not had a formal education in options trading.

I've done self-study but no formal courses.

Yes, I've completed formal courses and extensively studied options trading.

What are stock options?

Shares of stocks that I own.

A contract that entitles the holder to control (buy or sell) 100 underlying shares.

An alternative equity award.

What are the potential risks and rewards associated with options trading?

It is easy to get rich trading options.

Risk can be managed using specific tools and techniques.

Options transactions require less capital than traditional trading.

What is the difference between investing and trading?

Trading implies short-term buying and selling while investing has a more extended holding period that can last years.

Trading is primarily a long-term strategy.

Investing is typically a short-term strategy.

What is the difference between a Call option and a Put option?

A Call option is bullish.

A Put option is bearish.

Neither of the above

Both of the above

What is a strike price?

The predetermined price at which a specific security may be purchased or sold by the option holder.

The probability out of the money.

The volatility price.

What is implied volatility in options trading?

Predicts the direction in which the price change will proceed.

Involves using a mathematical formula to forecast the likely movement of a stock.

Predicts whether the price will go up, down, or see-saw between the two variables or go beyond.

What is a risk management strategy?

check all that apply

Risk/reward ratio

Position sizing

Hedging

The percentage at risk on any position

Profit goals

None of the above

What is the option assignment process?

When the seller assigns the shares of the option contract.

When the buyer must sell his options contract.

When the owner of an option exercises their right to buy or sell shares of stock or when options expire in the money.

What are American Options?

Options that can be exercised anytime up to & including expiration day.

Options available in the US.

Options that can only be exercised at the expiration date.

What is Delta used for?

check all that apply

Hedging Risk

Determining Probability

Managing position exposure

Position sizing

None of the above

What does BTO mean as related to options?

Buy to Open

Buy to Close

Sell to Open

Sell to Close

None of the above

What is different between the SPX and the SPY?

check all that apply

Underlying asset

SPX is a European-style options

SPY is American-style options

Settlement

None of the above

Can you have a position with both a short put and a long put for the same strike and the same expiration?

Yes

No

Sometimes

Stock ABC is trading for $76. Which option is ITM?

Put 71

Call 77

Call 76

Implied Volatility (IV) could be considered as:

Actual volatility

Past volatility

An estimation of future volatility

What is an Option Chain?

An indicator

A table with all the relevant option information

An option strategy

Which options could profit from a rise in the underlying price:

Long call

Short call

Short put

Long put

What is an Undefined Risk Strategy?

A Strategy with limited risk

A Strategy with no risk

The risk that is accompanied with naked options and when your possible max loss is unknown on order entry.

Does an option buyer have to exercise his option?

Yes

No

Sometimes

When you buy an option, you are:

Long the option

Short the option

What does ATM mean concerning options?

At the money

In the money

All the money

Out of the money

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