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Welcome to Option Screener - Your New Home for Options Research and Analysis

•By The Option Screener Team
announcementoptionsstrategies

Welcome to Option Screener, the ultimate platform for options traders looking to screen thousands of contracts across multiple strategies.

What is Option Screener?

Option Screener is a powerful tool designed to help traders of all levels find the potential option trade opportunities. Unlike single-strategy screeners, we currently support 14 different options strategies:

Category Strategies
Long Options Long Call (LC), Long Put (LP)
Wheel Strategies Covered Call (CC), Cash-Secured Put (CSP)
Vertical Spreads Bull Call, Bear Call, Bull Put, Bear Put
Volatility Plays Long Straddle, Long Strangle
Calendar Spreads Long Call Calendar, Long Put Calendar, Short Put Calendar
Long-Term LEAPS

(If you have a strategy not listed here that you'd like to see added, let us know!)

Understanding Our Scoring System

Every option contract in our system is scored using a composite algorithm that combines profitability likelihood with risk-adjusted returns. The formula is:

Score=Probability of Profit+Reward/Risk Ratio2\text{Score} = \frac{\text{Probability of Profit} + \text{Reward/Risk Ratio}}{2}

For example, a strategy with:

  • 70% probability of profit
  • 20% reward/risk ratio

Would score: (70+20)/2=45(70 + 20) / 2 = 45 points.

These scores are then normalized before the final daily dataset is published, i.e. they adjusted to fit within a 0-100 scale based on the best and worst scores across all names in a given strategy. This allows you to easily compare different strategies and contracts at a glance. For example, the normalized score for long call (LC), is calculated as:

Normalized ScoreLC=Scorecontract−Min ScoreLCMax ScoreLC−Min ScoreLC×100\text{Normalized Score}_{\text{LC}} = \frac{\text{Score}_{\text{contract}} - \text{Min Score}_{\text{LC}}}{\text{Max Score}_{\text{LC}} - \text{Min Score}_{\text{LC}}} \times 100

Likewise for long puts (LP), we calculate the score of a given contract scaled by the min and max of ALL long puts:

Normalized ScoreLP=Scorecontract−Min ScoreLPMax ScoreLP−Min ScoreLP×100\text{Normalized Score}_{\text{LP}} = \frac{\text{Score}_{\text{contract}} - \text{Min Score}_{\text{LP}}}{\text{Max Score}_{\text{LP}} - \text{Min Score}_{\text{LP}}} \times 100

and so on for each strategy.

Probability of Profit (POP)

We calculate the probability of profit using the delta greek:

POP=1−∣Δ∣\text{POP} = 1 - |\Delta|

Delta represents the probability that an option will expire in-the-money. By subtracting from 1, we get the probability that the option expires worthless (which is profitable for sellers) or profitably (for buyers, adjusted by break-even).

Risk-Adjusted Returns

The P/L ratio tells you how much you can make per dollar risked:

P/L %=Max Profit∣Max Loss∣×100\text{P/L \%} = \frac{\text{Max Profit}}{|\text{Max Loss}|} \times 100

This is crucial for position sizing and comparing opportunities across different strategies. We'll get into how we reasonably calculate potential max profit and loss for each strategy in future posts.

What's Next?

Over the coming weeks, we'll be publishing more educational content covering:

  • Deep dives into each strategy - When they can be used and how to screen for the potential opportunities
  • Greek analysis - Understanding delta, gamma, theta, and vega
  • Volatility trading - Using IV rank and IV percentile to time your entries
  • Risk management - Position sizing with the Kelly Criterion

Getting Started

Head to the Dashboard to start screening options. Free users can explore all strategies on the Magnificent 7 stocks, while paid subscribers get access to the full S&P 500 or entire market of optionable symbols.

Have questions? Contact us - we'd love to hear from you!

Happy screening!
-The Option Screener Team