A:The incorporation of options into all types of investment strategies has quickly grown in popularity among individual investors. For beginner traders, one of the main questions that arises is why traders would wish to sell options rather than ay buy them. The selling of options confuses many investors because the obligations, risks and payoffs involved are different from those of the standard long option.To understand why an investor would choose to sell an option, you must first understand ptu type of option it is that he or she is ths, and what kind of payoff he or she is expecting to make when the price of the underlying moves in the desired direction.Selling a put You are using an outdated browserYour browser, an old version of Internet Explorer, is not fully supported by Quizlet.Please download a newer web browser to put option at the money 88 your experience.Google ChromeMozilla Firefox.
The price that the writer of a call OR put option receives for the underlying asset if the buyer executes her option is called theA. strike priceB. exercise priceC. execution priceD. A or BE. A or C. An American call option moneh the buyer toA. sell the underlying asset at the exercise price on or before the expiration date.B. buy the underlying asset at the exercise price on or before the expiration date.C. sell the option in the open market prior to expiration.D. A and C.E.
B and C. A European call option allows the buyer toA. sell the underlying asset at the exercise price on the expiration date.B. buy the underlying asset at the exercise price on or before the expiration date.CHomeArticlesSelling Calls For IncomeSelling Puts For IncomeTop IdeasMy WatchlistYieldBoost RanksFREE registration required to continue.You have viewed pages within the last hours.
To continue, please register at Stock Options Channel for unlimitedpage views and our free weekly newsletter, by entering your name and email address below. I say generally because there are such a wide variety of option strategies that use multiple legs as their structure, however, even a one legged Long Call Option can be viewed as an option strategy.Under the Options101 link, you may have noticed that the option examples provided have only looked at taking one option trade at a time.
How could a trader profit from such a scenario.