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Options Trading
By Kristy Annely
An option is a contract that gives the buyer the right (but not the obligation) to buy or sell a specified quantity of a given asset, at a specific price, on or before a specified time.
An option is a contract that gives the buyer the right (but not the obligation) to buy or sell a specified quantity of a given asset, at a specific price, on or before a specified time. Unlike futures trading, the purchaser of an option is not obligated to buy or sell at the exercise price, and will only do so if it is profitable, if the option is allowed to lapse, the purchaser loses only the initial purchase price of the option (the option money).
The strike, or exercise price, of an option is the specified, pre-determ...
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