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written by reader Intro to Options – in a Q&A format

By timcoahran, May 14, 2020

Several folks have requested an ”Options 101” idea. I’m guessing the Prof might be picturing the workload of actually teaching a real semester course! (I for one, might be willing to pay separately for such a course. Anybody else?)
Alternately, we could try a much smaller workload model, a thread of single individual questions. Let’s try to keep a ”101” (college) level, meaning that students have already done some High-School-like preparation on their own. We have read or viewed the various tutorials offered on our brokers’ websites; looked up some definitions; already read what we can find in Johnson; etc.
I do see there was a similar attempt back in 2014, and it got traffic-bombed by a commercial guy. Ideally, I’d like to see THIS thread kept at a how-it’s-done level, rather than naming tons of specific stocks. I’ll throw out a first question:

Is there a way to purchase options for quantities smaller than 100 shares?
Just the cost of ”ONE contract” (the right to exchange 100 shares) with a meaningful time frame – is often a larger position than I could justifiably consider as a ”nibble.” And while certainly ABLE to later exercise a call on 100 shares, with the higher priced underlying stocks I would have to immediately sell part of the position to maintain right sizing (I’d see little sense in exercising only a portion of the option that I paid for).
Fractional contracts?

# Options 101

This is a discussion topic or guest posting submitted by a Stock Gumshoe reader. The content has not been edited or reviewed by Stock Gumshoe, and any opinions expressed are those of the author alone.

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luzbillionsonline
luzbillionsonline
May 21, 2020 2:24 pm

which is the best options recommendation newsletter?

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