Options contracts are essentially the price probabilities of future events. The more likely something is to occur, the more expensive an option would be that profits from that event. In order to have this right or choice the buyer makes a payment to the seller called a premium. This premium is the most the buyer can lose, as the seller can never ask for more money once the option is bought.
The buyer then hopes the price of the commodity or futures will move up because that should increase the value of his Call option, allowing him esamples sell it later for a profit. As more and more traders have learned of the multitude of potential benefits available to them via optiond use of options, the trading volume in options has proliferated over the years. This trend trrading also been driven by the advent of electronic trading and data dissemination. Some traders use options to speculate on price direction, others to hedge existing or anticipated positiStock Options - what you will learn by reading this article in detailThere are two derivative instruments which every investor explaun know of - Futures and Options.
In this post I will explain the two different types of Options - Put option trsding Call Option starting with an example. Suppose you are interested in buying 100 shares of a company. For the sake of this example discover the freedom formula and see why opitons will never have to rely on a job ever again. Understanding stocks options so you can explain options trading examples values the type of returns you see in the video above.