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The Truth about Stock Options and Options On Futures Trading
By Darren McLaughlin
Let's look at the basic facts about options trading before we go any further. Like any human endeavor options trading is best described in very careful language so that there's no confusion about our meaning. First, let's take a look at exactly what an option is.
An option refers to just that, the option to purchase certain stocks or certain commodity items by a certain date. This means you do not gain controlling interest in the stock or commodity until that date. For this reason, options can, and often do, expire worthless. There are two types of options contracts:
1) Contracts to buy blocks of stocks by a certain date 2) Commodity futures, which are o...
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