Wednesday, 4 March 2009

Some Basics

A few old chums have said that they didn't know what the hell I was on about- so a few pointers.
I trade FTSE index options. These are priced in pence but relate to FTSE at £10 per point- so a 3200 put trading at 20 is worth £200. A 3850 call trading at 43 is worth £430. Options do not move 1 for 1 with the index like a future does. for detailed explanations of the Greeks- the metrics of how options are priced, and how they move, there are many explanations on the 'net. For terrific free education there is 21stcenturyinvestor.com. Which has a 12 week course with Q&A.
FTSE index options are European style which means there is no early exercise-unlike share options which can bite yer bum in a moment.
I have a great many stats and charts so if anyone has a specific query I may be able to help with data. I'm always happy to talk about options trading however.

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