Option Chain

The pricing system for stocks is relatively simple. Want to buy 200 shares of Amazon? Just login to your stock trading software, look at the price, then buy it if you think the price is fair, or don’t buy it if you think it's too high.

It’s no different then a price tag at a retail outlet. Like...browsing that stained green couch you saw at the Salvation Army. The price tag says $25. Will it look good in your living room or not (once you get it deloused, of course)? The same with stocks. They basically have a price tag. Amazon is currently trading at $1,850 per share. One price...one decision.

Option trading is more complicated. There are different underlying assets and different expiration dates. The price presentation is more intricate. Thus, you have an option chain (or, as it's called by Keanu Reeves fans, an options matrix). The system provides a list of available option contracts for a particular asset and a particular expiration date. It consists of both puts and calls, as well as various strike prices, for the given asset and maturity. Each of these variations is presented with its price.