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Implied Volatility

The market's expectation of future volatility, backed out of option prices.

In-the-money

A term describing any option that has intrinsic value. A call option is in-the-money if the underlying security is higher than the striking price of the ca...

Incremental Return Concept

A strategy of covered call writing in which the investor is striving to earn an additional return from option writing against a stock position which he (sh...

Index

A compilation of the prices of several common entities into a single number. See also Price-Weighted Index, Capitalization-Weighted Index.

Index Option

An option whose underlying entity is an index. Most index options are cash-based.

Institution

An organization, probably very large, engaged in professional investing in securities. Normally a bank, insurance company, or mutual fund.

Intrinsic value

The value of an option if it were to expire immediately with the underlying stock at its current price; the amount by which an option is in-the-money. For...