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plain-language explainers for the structures and terms in the feed
What “unusual options flow” is (and isn't)
Unusual flow is options activity that stands out from a contract's norm — elevated volume vs open interest, large notional premium, sweeps, or a notable underlying move. It signals attention, not certainty: a large print can be a directional bet, a hedge, one leg of a spread, or a roll. OptionSniffer scores how unusual a contract is and explains why — it does not tell you what will happen.
The 0–100 score
Each flagged contract gets an explainable score from vol/OI, notional premium, underlying move, and sweeps, with an activity gate (large premium alone never flags). Implied-volatility context (put-call IV spread, skew) nudges conviction up or down. A higher score means more abnormal, not “more likely to profit.”
The Greeks, briefly
Delta ≈ how much the option moves per $1 in the underlying. Theta = time decay (accelerates near expiry). Vega = sensitivity to implied volatility. Gamma= how fast delta changes. They describe risk; they don't predict direction.
IV crush & earnings
Implied volatility tends to inflate before scheduled events (earnings) and collapse right after — “IV crush.” A long option can losevalue even when the stock moves your way, because vega losses outweigh the move. It's why buying premium into earnings is often a losing trade, and why we frame earnings flow as context, not a signal.
Vertical spreads (bull/bear, call/put)
Buy one option and sell another of the same type and expiration at a different strike. This defines risk and lowers cost versus a naked option, but caps the maximum gain. A bull call spread is a defined-risk bullish structure; a bear put spread, defined-risk bearish.
Straddles & strangles
Buy (or sell) both a call and a put. Straddle = same strike; strangle = different OTM strikes. Long versions profit from a large move in either direction (a volatility bet), not a directional one — so reading a straddle leg as “bullish call flow” is a mistake our detection corrects.
Iron condors
Sell an OTM put spread and an OTM call spread at once — a defined-risk, range-bound structure that profits from time decay if the underlying stays between the short strikes. Non-directional income; max loss is capped by the long wings.
Covered calls & the wheel
A covered call sells a call against 100 shares you own to collect premium. The wheelcycles: sell cash-secured puts until assigned shares, then sell covered calls until called away. These are income/premium-selling approaches — the focus of OptionSniffer's income screener.