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Intro Chapter 6 - Derivatives > Options > Flashcards

Options Flashcards

1
Q

Option Def

A

Gives holder right to buy / sell a

specified quantity

of a specified asset

at a fixed price on or before expiry

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2
Q

Buyer of a option

A

Also known as holder / long

Has. rights

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3
Q

Seller of a option

A

Also known as writer / short

Has obligations (if buyer exercises their rights )

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4
Q

Premium

A

Always paid by holder to writer

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Intro Chapter 6 - Derivatives (5 decks)

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