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Slovník pojmů a strategií
pro obchodování opcí
Kompletní slovník opcí: strategie, pojmy, řecká písmena a postupy pro výpis opcí. Přehledně, srozumitelně, pro začátečníky i pokročilé. Naučte se obchodovat opce efektivně.
Basic concepts
Beginner
Exercise
The exercise of the option right to buy (call) or sell (put) the underlying asset at the strike price.
Detail
Exercise means that the option buyer exercises the right that the option gives him. For a call option, this means that the buyer buys 100 shares at the strike price. For a put option, on the contrary, he sells 100 shares at the strike price. For American options, the option buyer can exercise the right at any time before expiration (early exercise), for European options only on the expiration day. Exercise is a process that automatically leads to assignment on the other side (the option writer is assigned). Exercise is most common for ITM options near expiration.
Exercise is a key feature of options, where the option buyer exercises their right. For a call option, this means buying the underlying (e.g., shares) at the strike price. For a put option, selling the underlying at the strike price. For example, if I own a call option on AAPL with a strike of 150 and the price of AAPL is 170, I can exercise the option and buy the shares for 150, even if the market price is 170. For American options, the option buyer can exercise the option at any time. For European options, only on the expiration date. Exercise often occurs automatically at expiration if the option expires ITM. Option writers must therefore be prepared for assignment.
Optimal conditions
ITM option near or at expiration. Often used for call options to buy shares, for put options to sell shares. Exercise makes sense if the difference between the market price and the strike is greater than the remaining time value of the option. Often used for dividend strategies (early exercise call when paying dividends).
Max profit
For the buyer of a call option: the difference between the market price and the strike minus the premium paid. For the buyer of a put option: the strike minus the market price minus the premium paid.
Max loss
For the option buyer, the maximum loss is the premium paid if they decide not to exercise the option (or if the option expires OTM). If they exercise the option and the underlying price then changes rapidly, they may incur an additional loss while holding the stock.
Risks
Exercising an option involves the actual purchase/sale of shares — the need to have capital to buy (call) or be ready to deliver shares (put). Risk of poor timing (exercising when it would be more profitable to sell the option). After exercise, the position may be more costly than closing the option at market price.
Greeks
Delta (the probability that the option will be ITM and will be exercised). Near expiration and ITM options with a delta approaching 1 have a high chance of exercise. Theta – approaching expiration increases the chance of exercise if the option is ITM.
Variations
Delta indicates the probability that an option will be ITM at expiration. Options with a delta of around 0.5 are ATM, while those with a higher delta (e.g. 0.8 - 1.0) are deeply ITM and have a high chance of being exercised. Theta (time decay) affects the value of an option nearing expiration — approaching expiration reduces the time value and increases the probability that a deeply ITM option will be automatically exercised and settled.
Usage example
I own a call option on AAPL with a strike of 150 and the price of AAPL is 170. I decide to exercise the option and buy 100 shares for $150/share (total $15,000), even though the market price is $170/share. I thus make an immediate profit of $20/share (minus the premium paid). For a put option: I own a put on MSFT with a strike of 300, the price has fallen to 280, I can exercise the right to sell 100 shares for 300 and immediately buy them back at a lower price.
DTE
Approaching expiration increases the probability of exercise for ITM options. The shorter the DTE and the deeper the ITM, the higher the chance of exercise.
IV (implied volatility)
High IV increases the option premium, but IV itself does not directly affect the exercise decision — the ITM/OTM option position and time to expiration are decisive.
Premium
The premium paid is the cost of obtaining the right to exercise. If the difference between the market price and the strike price does not cover the premium, it may be more profitable to sell the option than to exercise.
Margin
When an option is exercised, the blocked margin is used for settlement. However, the long or short stock position itself may have different, usually higher, margin requirements than the option.
Poznámky
Beware of automatic exercise at expiration of ITM options. It is necessary to have cash to buy shares (call) or sell shares (put), otherwise the broker may close the position against your will. Exercise can sometimes be replaced by selling the option in the market, thus avoiding the need for physical settlement.
Tags
exercise, exercise of an option, call option, put option, right to buy, right to sell, American option, European option, exercise, assignment
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