To the new option trader, it often seems as if he has entered into the terra incognita of the derivatives world through Alice's looking glass.

Last time we talked about an options trader having a commitment to excellence. This time we'll go over why an options trader needs a trading plan and how to go about writing one.

Have you ever wondered what makes a great options trader? I don't mean an options trader that does pretty well, but one that you envy and want to be?

Perhaps the most easily understood of the options price influences is the price of the underlying. All stock traders are conversant with the impact of the underlying stock price alone on their trades.

In an attempt to understand the complexities of the world they observed in daily life, ancient Babylonian philosophers considered all things to be constituted of one or more of the four classical elements of: earth, air, water, and fire.

This more visible portion of the clan retains the characteristic defining points of family identity: a variably large range of profitability with regard to price of the underlying and the theta positive blood type.

The naked call is defined as an option strategy where an option player sells (writes) call options without owning the underlying security. Some may refer to this strategy as an "uncovered call" or "short call."

Because it is the fancifully named winged beast category that garners the most attention, I thought today we could focus on the often overlooked members of the group: double calendars and double diagonals.

Moneyness isn't a word, is it? It won't be found on spell-check, but moneyness is a very important term when it comes to options.

In a straddle, the investor is betting on both sides of a trade by purchasing options with the same strike price and the same expiration date, on the same underlying.

A lot of investors are enamored by the all mighty put ? especially buying the shortest-term, or front month, put for protection.

You believe that this stock, despite its high price, continues to have tremendous upside potential. What can you do to maximize your money and cash in on the perceived upside?