Learn how to translate the specialized options tools you can find online.

Instead of options tables, many websites offer options chains or options strings. You select a particular underlying instrument, and can see a chain of all the options currently available, so that you can compare the prices for calls and puts, different strike prices, and different expiration months.

Also, you can choose whether to display all option strike prices, or only those that are in-the-money, at-the-money, or out-of-money, or any combination of the three. You can also select the expiration months to be displayed and whether to include LEAPS or not.

In addition to price information for each contract that appears in the option chain, you’ll find its theoretical value, implied volatility, and a calculation for each of the Greeks.

Managed Accounts Inna Rosputnia

Want your money to grow?

See how I can help you to make your money work for you

Managed Investment Accounts – unlock the power of professional asset management. Let me make you money while you enjoy your life.

Stock and Futures Market Research – use my technical and fundamental analysis to pick up swing trades with the best risk/reward ratio.

Send Request

Options chain terms and definitions

  • The uppermost area of the option chain indicates the name of the underlying stock, its ticker symbol, and the primary exchange on which the underlying stock is listed.
  • Just below you’ll find information about the underlying stock, including its current market price, its net change up or down, the 52-week high and low, and the stock volume. Options statistics include the average daily option volume for the option class as well as the average open interest.
  • You can find the month, day, and year of option expiration as well as the number of days until expiration. You can find the symbology key for each available option series.
Options Chains
  • The option symbol column indicates the option symbol for calls and puts on the underlying stock. For each strike price, the chain will display information for calls (C) and puts (P).
  • Bid indicates what buyers are willing to pay for the option, and ask indicates which sellers are willing to take for the option.
  • Change is a measurement of the percentage change in the option’s price for the day. A positive number indicates a price increase, while a negative number indicates a decrease.
  • Volume is the current number of contracts traded for each option series during the trading day. Some option chains allow you to view only options with a certain daily volume. Open interest indicates the total number of open contracts outstanding.
  • Implied volatility is the volatility percentage that produces the best fit for each option series.

Understanding bid and ask

The bid is the price that a buyer is willing to pay for an option, and the ask is the price that a seller is willing to accept. In general, the two prices are slightly different, and the gap between them is known as the spread. So how does that affect individual investors?

When you buy or sell an option—or a stock — you’re possibly buying from and selling to a market maker. One role of market makers is to provide liquidity in the marketplace, making it easier to buy or sell one or more options without changing the market price. One way market makers can profit is by buying options contracts at the current bid price and selling them at the higher ask price. Without a change in the underlying stock price, they may make a profit from the spread of only a few cents per contract. But they may trade in high volume every day, so the small profits can add up.

As a rule of thumb, the more actively traded an option is, the smaller the spread will be. But the bid and ask spread for any particular option contract may vary on the different exchanges where the contract is listed. So option brokers focus on getting their customers the best execution price among the various exchanges where the option is traded.

How To Use Options Chains? by Inna Rosputnia

Wishing you a great week!

Want Your Money To Grow?

Subscribe to get free research, trading lessons, and more insights.

(We do not share your data with anybody, and only use it for its intended purpose)