learning topics in options

A few loose "topics" --
a) option valuation at expiration and before
b) PCP
) log normal
) std dev
1) basic long/short positions => strategies like collar, condor, butterfly...
2) volatility and 1)
3) delta (and other greeks) and1)2)
4) hedging with 1)2)3)
) skew
) random variable
) binomial pricing tree

First realize that options are more complex than futures (which is more complex than forward contracts) --

* There are 2 prices -- exercise and premium (bid/offer).
* There's call and put, which are often related.
* option prices are sensitive to (the 3 Greeks)
** vol swings
** underlying asset price swings
** expiration date approaching

Next, focus --

- Focus on OTC. I feel listed options are more complex. Exchange must create a pair and maintain margins.
- Focus on American options. All listed options are American style.
- Focus on stock. Avoid index options as they involve cash settlement. FI options are way too complex. Currency option is also more complex as there's no clear distinction between what we pay (premium and strike) vs what we get -- both are "money".
- Focus on long positions. Shorts are less intuitive but still important.
- Focus on calls first but soon you must deal with puts