NCFM Options Trading Strategies study guide
NCFM Options Trading Strategies · Work through your exam, one topic at a time.
NCFM (NSE Certification in Financial Markets) is a certification programme delivered through the NCFM login portal, described on the NSE site as the portal for online testing and certification programmes offered by NAL Academy Limited (formerly NSE Academy Limited), an NSE group company. This page covers the Options Trading Strategies module, one of the self-study NCFM modules listed under the Learn section. The NCFM Options Trading Strategies study guide has 5 sections and about 1,903 words.
01Options Fundamentals and Contract Specifications
Options fundamentals and contract specifications reward precise knowledge of the contract itself: rights and obligations, exercise style, settlement method, lot size, tick size, expiry and how premium translates into cash flow. NCFM-style questions often test whether a candidate can distinguish index options from stock options and identify ITM/ATM/OTM correctly.
382 words, about 2 min02Option Pricing, Greeks and Volatility
Pricing questions test whether you can separate intrinsic value from time value, apply put–call parity, and interpret delta, gamma, theta, vega and rho. Volatility questions test implied versus historical volatility and the effect of IV changes on option prices.
389 words, about 2 min03Basic Option Strategies
Basic strategies test payoff construction and risk-reward arithmetic: covered calls, protective puts, bull and bear vertical spreads, and collars. You must identify maximum profit, maximum loss and breakeven without drawing the payoff.
379 words, about 2 min04Advanced and Combination Strategies
Combination strategies test whether you can classify a position by its volatility and direction view: straddles, strangles, butterflies, condors and ratio spreads. Questions often ask for maximum loss, breakevens and the market view implied by the structure.
386 words, about 2 min05Risk Management, Margins, Settlement and Regulatory Framework
This domain tests margin mechanics, settlement obligations and the regulatory plumbing behind exchange-traded options. Expect SPAN and exposure margin, upfront margin, position limits, exercise/assignment and physical settlement risk.
367 words, about 2 min