Episode 11 of Trading For Newbies introduces the concept of probabilities.
There are probabilities associated with different option strikes being in or out of the money at expiration. Probabilities are derived from the prices of the options and are a function of implied volatility.
On today's episode, Ryan and Beef explain how these values are calculated, why probabilities are important to us, and the various ways we can improve the probability of our trades success.Episode Contents
- Option Prices Infer Potential Outcomes
- Understanding Probability Of Profit
- Improving The Odds Of A Trade Being Successful
About Trading For Newbies
This series will educate you, the beginning trader on the basics of options trading and the tastytrade approach to trading. Our goal is to get you to the point where you will be able to actively find opportunities in the market, enter and exit trades, and clearly articulate what you are doing throughout the process.