Learn derivatives by simulating them.

You buy shares and hold them. You profit if the price rises and lose if it falls. Time has no decay; you keep the stock until you sell.

A call option gives you the right to buy 100 shares at a fixed strike price until expiry. You pay a premium upfront. Profit grows as the stock rises above the strike.

A put option gives you the right to sell 100 shares at a fixed strike price. You pay a premium. Profit grows as the stock falls below the strike.

You borrow shares and sell them now, hoping to buy them back cheaper later. You profit if the stock falls and lose if it rises.

You agree to buy the underlying at a future date for a price set today. P&L is roughly linear with spot, but with high leverage via margin.

Mirror of buying a future: you profit if the underlying falls. Linear payoff with leverage.

You collect the premium and agree to buy 100 shares at the strike if assigned. Often used to acquire stock at a discount, with cash set aside to cover assignment.

Buy a call at a lower strike, sell a call at a higher strike (same expiry). Cheaper than a naked long call: the short call funds part of the premium, but capping your upside.

Buy a put at a higher strike, sell a put at a lower strike. Cheaper than a long put alone, with capped downside profit.

Sell a put at a higher strike, buy a put at a lower strike (protection). You collect a net credit upfront. Profitable if the stock stays above the upper strike.

Sell a call at a lower strike, buy a call at a higher strike (protection). Net credit upfront. Profitable if the stock stays below the lower strike.

You own 100 shares per contract and sell one call against them. You collect a premium; if the stock rallies past the strike, your shares are called away.

You own 100 shares per contract and buy a put as insurance. Caps your downside in exchange for the premium paid.

Long stock + long OTM put + short OTM call. The short call funds the protective put. Caps both upside and downside.

Buy a call and a put at the same strike (usually ATM) and same expiry. Profits from a large move in either direction.

Buy an OTM call and an OTM put. Cheaper than a straddle but needs a bigger move to profit.

You collect the premium upfront in exchange for the obligation to deliver 100 shares at the strike if assigned. Profitable if the stock stays at or below the strike.

Sell an ATM call and an ATM put. You collect both premiums and profit if the stock pins the strike. Both sides have unbounded loss potential.

Sell an OTM call and an OTM put. Wider profit zone than a short straddle, smaller credit.

Sell an OTM put spread AND an OTM call spread. Four legs, one expiry. Net credit upfront. Profit zone is between the short strikes.

Iron condor where the short put and short call share the same strike (usually ATM). Bigger credit, narrower profit zone.