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Course Content
Options Fundamentals
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Call and Put Options Explained
Options Pricing and Greeks
Exercise and Assignment Process
Basic Options Strategies
In 2026, the most successful retail traders have moved away from "gambling" on high-leverage options and instead use Basic Options Strategies to create consistent cash flow and protect their existing portfolios.Here are the four essential strategies that form the foundation of a professional options toolkit.1. Covered Call (The Income Generator)This is the most popular strategy in 2026 for long-term investors. You sell a call option against shares you already own.Setup: Own 100 shares of a stock + Sell 1 Out-of-the-Money (OTM) Call.The Goal: To collect the Premium (cash) from the buyer while waiting for the stock to rise.The Outcome:Stock stays flat/down: You keep the shares and the cash.Stock hits the Strike: you sell your shares at a profit and keep the cash.Best For: Generating "synthetic dividends" on stocks you plan to hold anyway.2. Cash-Secured Put (The "Buy at a Discount" Strategy)Instead of buying a stock at the current market price, you get paid to wait for a better price.Setup: Have enough cash to buy 100 shares + Sell 1 OTM Put.The Goal: To get paid a premium to commit to buying a stock at a lower price (Strike Price).The Outcome:Stock stays above Strike: You keep the cash and try again next week.Stock drops below Strike: You are "assigned" the shares at the lower price you wanted, and your effective cost is even lower because of the premium you kept.3. Long Call & Long Put (The Directional Bets)These are the simplest forms of options trading, used to profit from a specific price move without owning the underlying asset.Long Call: You buy a call because you believe the price will go up significantly. It offers unlimited profit potential with limited risk (the premium paid).Long Put: You buy a put because you believe the price will go down. This is often used as "Insurance" to protect a portfolio during a market crash.4. Strategy Comparison TableStrategyMarket SentimentPrimary GoalRisk ProfileCovered CallNeutral to Slightly BullishIncome GenerationMedium (Stock can still fall)Cash-Secured PutNeutral to Slightly BullishBuy Stock CheaperMedium (Stock can still fall)Long CallAggressively BullishLeverage / ProfitLow (Only lose premium)Long PutAggressively BearishProfit / ProtectionLow (Only lose premium)5. The "Wheel" Strategy (The 2026 Professional Workflow)Many 2026 traders combine these into a cycle known as The Wheel:Sell Cash-Secured Puts until you are assigned shares.Once you own the shares, sell Covered Calls until the shares are called away.Repeat. This allows you to collect premiums at every stage of the market cycle.2026 Tactical Note: In today's high-volatility environment, professional traders typically look for 30–45 Days to Expiration (DTE). This provides the best balance between capturing Theta (Time Decay) and giving the trade enough time to work.💡 Student ExercisePick a "Blue Chip" stock (like Apple or Tesla). Look at the options chain for 30 days from now.How much cash would you receive today for selling a Covered Call 5% above the current price?If you did this every month, what would your "annual yield" be from premiums alone?
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Covered Calls and Cash-Secured Puts
Long Calls and Puts
Options vs Stock Trading
Advanced Strategy Combinations
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Spreads and Straddles
Iron Condors and Butterflies
Calendar and Diagonal Spreads
Risk Management and Psychology
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Position Sizing for Options
Managing Winners and Losers
Avoiding Common Options Mistakes
Course Overview: Options Trading Masterclass

In 2026, the barrier to entry for options trading is lower than ever, but the speed of the market has increased the “Cost of Error.” Professional traders survive not just by knowing what to do, but by obsessively avoiding the traps that wipe out 90% of retail participants.

Here are the most common options mistakes and how to immunize your portfolio against them.

1. The “Cheap Option” Trap (Lottery Tickets)

New traders are often lured by options that cost only $0.05 or $0.10. They believe they are “buying low,” but in reality, they are buying Far Out-of-the-Money (OTM) contracts with a near-zero probability of profit.

  • The Mistake: Chasing “Lotto” plays that require a massive, immediate move in the stock.

  • The 2026 Fix: Focus on options with a Delta of 0.30 to 0.70. While they cost more, they have a statistically significant chance of success and are less sensitive to minor price fluctuations.

2. Underestimating “The Silent Killer” (Theta)

Many beginners treat options like stocks, assuming that if the stock eventually goes up, the option will too.

  • The Mistake: Holding a long position while the stock moves sideways. Theta (Time Decay) will eat the option’s value even if you are “right” about the direction.

  • The 2026 Fix: If your directional thesis hasn’t played out within 50% of the time you purchased, exit the trade. Don’t wait for expiration to see if you’re right.

3. Ignoring Implied Volatility (IV) Crush

Traders often buy calls right before an Earnings Report because they are bullish. The stock jumps 5%, but the option loses value.

  • The Mistake: Buying when IV is at an all-time high. Once the news is out, IV collapses (IV Crush), sucking the premium out of the option.

  • The 2026 Fix: Check the IV Rank. If IV is in the top 80th percentile, consider selling spreads instead of buying them to let volatility contraction work in your favor.

4. Gamma Risk in 0DTE Options

The 2026 obsession with 0-Days-to-Expiration (0DTE) options has led to massive “Gamma Squeezes.”

  • The Mistake: Selling “Naked” 0DTE options for a small premium. Near expiration, Gamma is at its highest, meaning a $1 move in the stock can cause a $10 swing in your option’s price in seconds.

  • The 2026 Fix: Use Defined Risk Spreads (Verticals or Iron Condors) instead of naked positions. This caps your maximum loss and prevents a “Flash Crash” from liquidating your account.

5. Psychological Pitfalls: “Loss Aversion”

Human psychology is wired to “hope” when losing and “fear” when winning.

Bias How it Ruins Your Trade 2026 Discipline
Loss Aversion Holding a loser until it hits $0, hoping for a “bounce”. Set a “Hard Stop” at 50% loss and stick to it.
Recency Bias Thinking a 5-day win streak means you’re invincible. Keep position sizes constant regardless of recent wins.
FOMO Chasing a stock that has already moved 20% today. If you missed the entry, wait for the next setup. The market is open every day.

💡 The 2026 “Error Checklist”

Before hitting “Submit Order,” ask yourself:

  1. Is my Position Size less than 2% of my account?

  2. Am I buying Time (at least 30-45 days) or gambling on 0DTE?

  3. Is IV currently cheap (buying) or expensive (selling)?

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