The "daily Call" From Option Alpha: Options Trading | Stock Options | Stock Trading | Trading Online

Hey everyone, Kirk here again from Option Alpha and welcome back to the daily call. In today’s daily call, we’re going to answer the question – “Does buying or selling options affect the stock’s price?” I think I got that right. I checked with my wife. That’s affect, not effect. I hate those two different words. That’s why I like options trading and math where you’re better than writing and grammar. But anyways, I think the question comes up a lot because people think that the options market drives a stock’s price. The reality is that in most cases… I would say in most cases because I rarely doubt that this is ever the case. But who knows if people see option activity and then as a result, change their dynamic in buying stock. But options are derivatives of stock pricing and stock underlyings which means that they derive their value from stock, but they are not necessarily tied to the stock’s price. In fact, we see this a lot where an option contract will go up and down in value because of the implied expecta