OPTIONS TRADING GUIDE
OPTIONS TRADING GUIDE
What are options?
Options are a type of derivative security. An option is a derivative because its price is intrinsically linked to the price of something else. An option is a contract giving the buyer the right, but not the obligation, to buy (in the case of a call) or sell (in the case of a put) the underlying asset at a specific price on or before a certain date. People use options for income, to speculate, and to hedge risk.
A stock option contract typically represents 100 shares of the underlying stock, but options may be written on any sort of underlying asset from bonds to currencies to commodities. Options are contracts that give the bearer the right, but not the obligation, to either buy or sell an amount of some underlying asset at a pre-determined price at or before the contract expires.
But why would an investor use options?
Well, buying options is basically betting on stocks to go up, down or to hedge a trading position in the market. The price at which you agree to buy the underlying security via the option is called the "strike price," and the fee you pay for buying that option contract is called the "premium." The seller has the corresponding obligation to fulfill the transaction – to sell or buy – if the buyer (owner) "exercises" the option. An option that conveys to the owner the right to buy at a specific price is referred to as a call; an option that conveys the right of the owner to sell at a specific price is referred to as a put. Both are commonly traded, but the call option is more frequently discussed.
Options are powerful because they can enhance an individual’s portfolio. They do this through added income, protection, and even leverage. Depending on the situation, there is usually an option scenario appropriate for an investor’s goal.
OPTIONS TRADING GUIDE: Olymp Trade
Who is Olymp Trade?
Olymp Trade is owned by Smartex International Ltd which is an offshore company registered in St. Vincent and the Grenadines.
It is one of the fastest growing companies that deliver access to trade to the client at any level, increasing its trading volumes daily and currently closes around 32M trades per month.
Olymp Trade received numerous awards, the world industry recognition for their services, options trading platform, fast growth, and innovations.
They are also members of the international Financial Commission (FinaCom) and guarantee each traders deposit insurance, comprehensive support and prompt resolution of all issues.
OPTIONS TRADING GUIDE:
Olymp Trade Webinar
Olymp Trade offers free webinars & strategies to its traders. As part of Olymp Trade services you will receive free trading tutorials and information for every Financial Commission participant.