Use for defining terms and concepts.
Being “long on a stock” means that you own shares of that stock, with the expectation that its price will increase in value over time. Ownership: When you go long, you are actually purchasing and holding the shares of a company. You become a shareholder. Bullish Outlook: This position reflects a “bullish” outlook, meaning you …
Θ THETA Theta (Θ), often called “time decay,” is an options greek that tells you how much an option’s price is expected to decrease each day due to the passage of time. Options lose value every day, even if the underlying stock doesn’t move. Theta Θ quantifies this daily loss as a number. It’s like …
▲ DELTA In simple terms, ▲ Delta tells you how much an option’s price is expected to change for every $1 move in the stock price. Call Options (positive Delta): For call options, Delta ranges from 0 to 1. A Delta of 0.50 means that if the underlying stock goes up by $1, the call …
Here are some definitions of the terms I use frequently to describe strategies, or parts of strategies.
REALIZED GAINS When you have completed the cycle of buying, then selling any instrument whether that be a stock, option, piece of land, or a bicycle, the resulting gain or loss can be referred to as your “realized gains.“ With our investment portfolio, these can accumulate over time across several stock symbols, several days, weeks, …
The Bag – Are you caught holding the bag?