Options glossary
32 crypto options terms in plain language. See the course for charts and the calculator for your own scenario.
📘 Options course🧮 Calculator🐋 Live options data
- Option
- A contract giving the RIGHT to buy (call) or sell (put) an asset at a set price on a set date. The buyer pays a premium; the seller receives it and takes on the obligation.
- More →
- Call
- The right to buy at the strike. At expiry it is worth price − strike if above, otherwise nothing.
- max(0, S − K)
- More →
- Put
- The right to sell at the strike. At expiry it is worth strike − price if below. Also used as insurance for coins held.
- max(0, K − S)
- More →
- Strike price
- The price at which the option's right applies. Each expiry lists dozens of strikes around spot.
- Expiry
- When the option ends. Crypto options usually expire at 08:00 UTC; daily, weekly, monthly and quarterly expiries exist.
- European option
- An option exercisable only at expiry. Nearly all crypto options are European; they can still be sold on the exchange before expiry.
- Cash settlement
- No delivery at expiry; an in-the-money option pays its intrinsic value.
- ITM / ATM / OTM
- In the money: has intrinsic value. At the money: strike nearest spot. Out of the money: no intrinsic value, price is all time value.
- More →
- Intrinsic value
- What the option would pay if exercised now: spot − strike for a call, strike − spot for a put; never negative.
- Time value
- The part of the price above intrinsic value — the price of the chance of a favourable move before expiry. Zero at expiry.
- prim − içsel değer
- Break-even
- The expiry price where profit/loss is zero. Long call: strike + premium; long put: strike − premium (before fees).
- More →
- Implied volatility (IV)
- Expected annualized volatility backed out of option prices. It prices the size of moves, not direction. Higher IV means pricier options.
- More →
- IV crush
- A sharp drop in implied volatility after an anticipated event passes. Option buyers can lose value even if price moves their way.
- Delta
- Change in option price per $1 move in the underlying. Calls 0 to 1, puts −1 to 0; ATM about ±0.5.
- Gamma
- How fast delta changes. Largest for ATM options near expiry, which is why short-dated options swing quickly.
- Theta
- Value lost per day to time decay, all else equal. A cost for buyers, income for sellers; accelerates near expiry.
- Vega
- Change in option price per 1-point change in implied volatility. Larger for longer-dated options.
- Open interest (OI)
- The total of option contracts not yet closed. High OI at a strike means many positions there; it does not show direction.
- More →
- Put/call ratio
- Put open interest (or volume) divided by calls. Above 1 means more put positioning; since puts are also hedges, it is not directional on its own.
- OI(put) ÷ OI(call)
- Max pain
- The expiry price at which option buyers' total payout is smallest (from open interest). There is no rule that price goes there.
- argmin_K Σ OI · içsel değer(K)
- GEX (gamma exposure)
- An estimate of how much hedging option dealers must do per 1% move. Dealers' real positions are unknown, so it relies on a common assumption (long calls, short puts).
- Σ γ · OI · S² · 1% · (call +, put −)
- Gamma flip
- The price at which estimated net GEX changes sign. Not a target or an entry/exit level.
- Skew and 25Δ risk reversal
- The gap between put and call implied volatility for the same expiry. 25-delta put IV − call IV above zero means downside protection costs more.
- IV(25Δ put) − IV(25Δ call)
- Term structure
- ATM implied volatility across expiries. Normally longer-dated is slightly higher; when short-dated is higher (inverted), the market may be pricing a near-term event.
- Expected move
- The roughly ±1 standard deviation range to expiry implied by the ATM straddle price — about a 68% implied range; not a forecast.
- ≈ call(ATM) + put(ATM)
- Straddle / strangle
- Straddle: call + put at the same strike. Strangle: OTM call + put at different strikes. Buyers profit from a big move either way; sellers from a quiet market.
- More →
- Spread
- Buying one option and selling another of the same type at a different strike. Lowers cost and caps both profit and loss.
- More →
- Inverse (coin-margined) contract
- Premium and P/L are in the underlying coin (Deribit BTC/ETH, OKX BTC-USD). Dollar results also move with the coin price.
- Mark price
- The exchange's fair-value price for an option, used for margin and P/L. Can differ from the actual bid/ask.
- Block trade
- A large trade negotiated off the order book and reported to the exchange; often institutional.
- Unusual options flow
- Patterns such as volume far above open interest, buyer-heavy premium, heavy buying of far OTM near-expiry options or a single large trade. ByStock shows them as context; not a trading signal.
- More →