bitcoinea

Trading: What is an 'Option'?

Trading: What is an 'Option'?

An option is a financial instrument that's valued based on the underlying security, for example stocks, bonds, commodities or foreign currency.


When you transact the option, the underlying asset follows suit.


Obviously, all of that is included in the contract.


Usually, within the option contract, you'll find the underlying asset, ie XY number of XY stock, the so-called 'strike price', ie the price at which the option is executed.


You also have an expiry date, and the premium, ie the amount you pay for the option.

How do you rate this article?

8


LeftFooted
LeftFooted

I’m a left-footed duck that loves writing. I write about cars, watches, craft beer and, you’ve guessed it, crypto Also active on read.cash


bitcoinea
bitcoinea

Let’s talk crypto 💎💠

Publish0x Publish0x

Reward the author with $0.01 in crypto, and earn yourself as you read!

20% to author / 80% to me.
Rewards are FREE. Publish0x pays them, not you.

Page not displaying correctly?