Around a 1000 BC Aristotle Thales predicted by the stars that there would be a bumper olive harvest and bought options on the use of olive presses.
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Lets assume you buy a call (right to buy) 100 shares of Xyz company at an agreed price (strike price) on an agreed date (expiration date) at say $40 per share and you pay $5 for the option.
When to commodity charts with learning trading and also index day trading for great results!
You can also sell options (as opposed to buying a put).
When to commodity charts with learning trading and also index day trading for great results!
At this stage it may seem that the buyer of the option has all the cards but don’t forget the seller of the option receives the money for granting the option.
Options are frequently used in real estate deals.