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Options Jive

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Credit-to-BPR and IVR

Options Jive

Options involve risk and are not suitable for all investors. Please read Characteristics and Risks of Standardized Options before deciding to invest in options.

The ratio of initial credit to BPR is a good way to approximate the initial risk-to-reward ratio of a trade.

Trades with higher credit-to-BPR are generally more favorable, as this trade has a higher initial profit potential for the given amount of risk.

Tom and Tony take a look at this ratio in different IVR (IV Rank) environments to see how the risk-adjusted reward potential changes with IVR.

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