Options are not suitable for all investors as the special risks inherent to options trading may expose investors to potentially rapid and substantial losses.
Options trading subject to TD Ameritrade review and approval. Please read Characteristics and Risks of Standardized Optionsbefore investing in options.
Spreads, collars, and other multiple-leg option strategies, as well as rolling strategies can entail substantial transaction costs, including multiple commissions, which may impact any potential return. These are advanced option strategies and often involve greater risk, and more complex risk, than basic options trades.
The collar position involves the risks of both covered calls and protective puts.
With the protective put strategy, while the long put provides some temporary protection from a decline in the price of the corresponding stock, this does involve risking the entire cost of the put position.
Probability analysis results are theoretical in nature, not guaranteed, and do not reflect any degree of certainty of an event occurring.
Theta is a measure of an option's sensitivity to time decay.
Education Center content is provided for illustrative and educational use only and is not a recommendation or solicitation to purchase or sell any specific security.
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ThinkOrSwim Basics Tutorial - How to Buy Options
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