Saturday, 30 November 2019

Unit 5: Introduction to Options European options:


                    Unit 5: Introduction to Options European options:

European options are options that can be exercised only on the expiration Notes date itself.

Expiration date: The date specified in the options contract is known as the expiration date, the exercise date, the strike date or the maturity.

Index derivatives: Index derivatives are derivative contracts which derive their value from an underlying index.

Option Premium: The “price” an option buyer pays and an option writer receives is known as the premium.

Option: An option is a contract that gives the buyer the right, but not the obligation, to buy or sell an underlying asset at a specific price on or before a certain date.

Put option: A put option gives the holder the right but not the obligation to sell an asset by a certain date for a certain price.

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