Part5 Institution Trading

1. Strike Price
The price at which the underlying asset can be bought or sold.

2. Premium
The price paid to buy the option. This is non-refundable.

3. Expiry Date
All options in India are time-bound. They expire on a specific date—weekly (for index options like Nifty, Bank Nifty), monthly, or quarterly.

4. In The Money (ITM)
An option that has intrinsic value. For example, a call option is ITM if the current price > strike price.

5. Out of The Money (OTM)
An option with no intrinsic value. A call option is OTM if the current price < strike price.
6. Lot Size
Options contracts are traded in predefined quantities. For example, one lot of Nifty = 50 units.

7. Open Interest (OI)
Shows how many contracts are open at a strike. Useful for identifying support/resistance zones.

8. Greeks
Metrics that determine option price behavior:

Delta: Sensitivity to price movement.

Theta: Time decay.

Vega: Volatility impact.

Gamma: Rate of change of Delta.