A short time later, the option is trading at $2.10 with the underlying at $43.34, yielding an implied volatility of 17.2%.

Those options had traded in relatively low volume until Friday, when options to buy 20,000 shares were traded.

With McKesson's stock droop, those options were trading yesterday at $2.25, a gain of 200 percent.

Nor did Mr. French support Mr. Chitwood's assertion that the options traded on an exchange in London.

The VIX is determined by a complex formula that is based on the assumption that, other things being equal, options will trade for higher prices when expected volatility rises.

Since options typically trade at only a fraction of the value of the underlying stock, call option contracts provide enormous leverage to would-be inside traders.

The options traded at all the major exchanges.

A short time later, the same option might trade at $2.50 with the underlier's price at $46.36 and be yielding an implied volatility of 16.5%.

For example, on Friday 123 million shares of the fund of the Nasdaq 100 index changed hands, while 834,866 contracts, or roughly 83 million options, on the index traded.

When you're ready to buy a new car, many dealerships offer the option to trade in your old car.