Class: Buying Calls

"Buying Calls" (Options 202) introduces buying calls as a directional, decidedly bullish strategy. This course covers profit potential, maximum risk, primary benefits, and how the choice of a long call's strike price and expiration month can allow an investor to tailor both risk of loss and profit potential. At the conclusion of the chapters and prior to the final quiz the student should know and understand all the topics under the "What You Have Learned" tab.

Chapter 1 - Introduction

Introduces what a long call is, what some of the benefits are, and what the position looks like graphically. This chapter also explains how long calls can be components of more complex trades.

Chapter 2 - Strategy Overview

In this chapter the benefits of a long call position are explained along with profit potential, loss potential, break-even point, the effect of volatility change and the passage of time.

Chapter 3 - Strategy Specifics

This chapter takes a hypothetical call purchase and then comprehensively expands on each of the sub-topics of Chapter 2. This chapter finishes by explaining the effects of a dividend on a long call position and how the early exercise of the call would enable the call holder to participate in the dividend.

Chapter 4 - Choices

This chapter explores how the choice of month and strike correlate to risk and reward is explained thoroughly. This chapter discusses how motivations lead us to risk vs. reward assumptions, which then lead us to corresponding months and strikes.

Chapter 5 - Alternatives

For this chapter the alternatives the long call investor has before expiration are explained.

Chapter 6 - Conclusion

This chapter ties together all the previously discussed concepts.

Chapter 7 - Review and Quiz

Review of what you have learned and final quiz.