Options Education

OIC302W : Time Spreads

Webcast Objective:

To understand the concepts surrounding time spreads and how these spreads can benefit from time value erosion. Begin to recognize the importance of how to manage a time spread in the event of unfavorable moves in the underlying stock's price.

Who Should Take This Webcast:

Intermediate II and Advanced students

Webcast Duration:

15 Minutes

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Webcast Description:

In this brand new offering from The Options Industry Council, Peter Lusk of the Chicago Board Options Exchange discusses time spreads, also known as a calendar or a horizontal spread. If you're neutral on an underlying stock, learn how you might use this hedged position to profit from decay in an option's time value, but with a limited, maximum loss amount that you know up-front. Peter will also address management of this spread in the event of unfavorable moves in the underlying stock's price.

Webcast Outline:

  1. Intro
  2. Time Spreads
  3. Presentation Outline
  4. Time Spread Basics
  5. Time Spread
  6. Time Decay & Volatility
  7. Time Spread
  8. Time Spread at Near-Term Expiration
  9. Time Decay Review
  10. Establishing Time Spread
  11. Long Call Time Spread
  12. Long May/Jul 50 Time Spread
  13. May Expiration
  14. Long Call Time Spread
  15. Before May Expiration - Management
  16. Neutral Time Spread Bullish or Bearish?
  17. Time Spread vs. Short Straddle
  18. Another Way to Sell Time Value?
  19. Short Straddle vs. Time Spread
  20. Summary

Webcast Resources:

Podcasts

OIC430P: Managing the product: Strategic Advantages to Inaction, Part 1

OIC431P: Managing the product: Strategic Advantages to Inaction, Part 2

Webcasts

OIC301W: Trading Spreads

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