Option Geometry Options Strategy Analysis & Modeling

Options Guides

In-depth educational guides to options strategies, pricing models, volatility and risk: how payoffs, breakevens and the Greeks are calculated, which assumptions the models make, and where they stop describing real markets.

To analyze a hypothetical position with your own assumptions, use the Options Strategy Analysis Workbench; the methodology describes its models and their limits.

  1. Iron Condor Options Strategy: Payoff, Breakevens, and Risk

    How a short iron condor works: the four legs, payoff formulas, breakevens, maximum loss, a worked example, Greeks, implied volatility, and assignment risk.

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  2. Straddle vs. Strangle Options: Payoffs, Breakevens, and Volatility

    Long and short straddles vs. strangles: cost, breakevens, payoff tables, Greeks, IV crush, margin, and assignment, with a fully worked example.

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  3. Vertical Spreads Explained: Debit vs. Credit, Bull vs. Bear

    Bull call, bear put, bull put, and bear call spreads explained: payoff formulas, a worked example, why debit and credit versions match, Greeks, and assignment.

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  4. American vs. European Options: Exercise, Dividends, and Pricing

    American vs. European options: exercise rights, when early exercise pays, how dividends and interest rates drive it, and how American options are priced.

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  5. Options Greeks Explained: Delta, Gamma, Theta, Vega, and Rho

    Option Greeks explained with worked examples: what delta, gamma, theta, vega, and rho measure, in which units, how they add up, and where they fail.

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  6. Implied Volatility in Options: Pricing, IV Crush, and Scenarios

    Implied volatility in options explained: how IV is solved from prices, how it differs from realized volatility, and why IV crush happens, with worked math.

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  7. Covered Calls Explained: Premiums, Payoff, and Assignment Risk

    What is a covered call? How the premium sets breakeven and max profit, what you give up, how strike, IV and dividends matter, and when early assignment hits.

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  8. Black–Scholes Model Explained: Formula, Examples, and Limits

    The Black–Scholes model explained: call and put formulas with dividends, a step-by-step example, why expected return drops out, and where the model breaks.

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  9. Put-Call Parity: Formula, Dividends, and Synthetic Positions

    Put-call parity explained: the formula with dividends, worked examples, synthetic positions, American-option bounds, and why arbitrage rarely survives costs.

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  10. Options Strategies Explained: Payoffs, Risk Profiles, and Tradeoffs

    Options strategies compared on one option chain: payoff shapes, max profit and loss, breakevens, Greeks, defined vs. undefined risk, and what each bets on.

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