Glossary Term: OPTION
Definition(s) for OPTION:
1. ) refers to a contract that permits the owner (depending on the type of option held) to purchase or sell a security at a specific ('strike') price until a specified expiration date. An option to purchase a security is known as 'call.' An option to sell a security is termed as 'put.
2. ) A contract that conveysthe right, but not the obligation, to buy or sell a particular item at acertain price for a limited time. Only the seller of the option is obligatedto perform.
3. ) A contract that provides the right, but not the obligation, to buy or sell a specific amount of a specific security within a predetermined time period One call option contract gives the buyer the right to purchase, or a put buyer to sell, 100 shares of the underlying stock in exchange for a premium based on the time value The seller of the contracts is called the writer See also Futures
4. ) A contract that gives the owner the right, but not the obligation, to buy or sell a particular asset (the underlying stock) at a fixed price (the strike price) for a specific period of time (until expiration) . The contract also obligates the writer to meet the terms of delivery if the contract right is exercised by the owner.
5. ) The right (but not the obligation) to buy or sell securities at a fixed price within a specified period.
6. ) The right (but not the obligation) to buy or sell securities at a fixed price within a specified period.
7. ) ‘‘Futures, forward, and standby contracts.’’
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See Also:
AMERICAN OPTION OR AMERICAN-STYLE OPTION, ASIAN OPTION, BERMUDA OPTION, COMPOUND OPTION, EMBEDDED OPTION, HIDDEN OPTION, IMBEDDED OPTION, LIQUIDITY OPTION RISK, MODIFIED AMERICAN OPTION, OPTION ADJUSTED SPREAD (OAS), OPTION RISK, OPTION WRITER, OPTION-ADJUSTED DURATION, OPTION-ADJUSTED SPREAD (OAS), INCENTIVE STOCK OPTION (ISO), OPTION POOL
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