Options Trading in Spreadsheets

Learn how to price options contracts and visualize payout of various options strategies using spreadsheets.

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4 Hours16 Videos60 Exercises2,364 Learners
5200 XP

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Course Description

Options are an extremely important part of the financial markets. They matter not only to traders and asset managers, but also to anyone that receives stock options from their employers as part of their benefit packages. Understanding what options are — and, indeed, how they can make you money — can be made a lot easier with the use of technology. Throughout this course, you'll work with data and formulas to help you get the most out of trading via Google Sheets. By the end of this course, you will be able to use Google Sheets to build a valuation model from scratch and use it to price actual option contracts. Come along on this fun and interactive journey with Google Sheets!

  1. 1

    Introduction to options

    Free

    In this chapter, you'll take your first steps on the path to mastering option valuation models in spreadsheets. In this chapter, you will learn the basics of derivative contracts known as options. You will find out how to use spreadsheets to perform basic operations to compute the value of different types of option contracts.

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    Introduction to options
    50 xp
    Call and put option values
    100 xp
    Profit MAXimization
    100 xp
    IF() the formula is correct
    100 xp
    Calculating the payoffs
    100 xp
    Putting it in writing
    50 xp
    Filtering
    100 xp
    Summing payoffs up with SUMIF()
    100 xp
    Look up and sum
    50 xp
    Utilizing VLOOKUP() for options trading
    100 xp
    Calculating option values
    100 xp
    VLOOKingUP payoffs
    100 xp
  2. 2

    Options (and Strategies), Illustrated

    Things get slightly more complex in this chapter. You will learn option strategies, or combinations of option contracts designed to profit from your view of the markets. By the end of the chapter, you will gain knowledge of some of the most popular strategies such as bull and bear spreads and learn how to use spreadsheets to visualize possible outcomes of your strategies, while learning several useful spreadsheet functions along the way!

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  3. 3

    Option Greeks

    In the third chapter, you will take a trip to the United States and then to Greece to learn the main elements of the Black-Scholes model, which enables you to calculate the fair value of an option contract and to work out its sensitivities to various factors, such as changes in the price of the underlying asset and time decay.

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  4. 4

    Binomial Model for Option Pricing

    In the final chapter of the course, you will master the binomial option pricing model. It is a very useful tool, which enables you to compute the present value of an option contract based on the likelihood and magnitude of changes in the price of the underlying asset. You will utilize advanced spreadsheet formulas to build the model and expand it by an additional period.

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Collaborators

Maggie MatsuiChester IsmaySara Billen

Prerequisites

Intermediate Spreadsheets
Sergei Balashov Headshot

Sergei Balashov

Chartered Financial Analyst

Sergei Balashov is a Chartered Financial Analyst based in London, UK. A former financial journalist, Sergei left that career to fully focus on the technical side of the financial profession. He is a data science enthusiast with a keen interest in the impact of data science techniques on economic analysis.
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