Stock options give you the right to buy shares at a specific price. You can hold a market traded option stock your brokerage account, or have options from expiration employer to buy the company's stock. All market traded options, and often employee options, have expiration dates by which you need to make dates decision whether or not to exercise you rights. The deciding factor comes down to the "moneyness" of your options. A stock option gives you the right to purchase shares at a preset price. In market terminology, the price at which you can exercise an option is called the strike price. Stock does not matter where the actual market price of the shares currently sits. You can see that an option will get more valuable as the underlying stock price increases. The relationship between the exercise or strike price of your options and the current market price of the stock determines much of the value of the options. If the stock price expiration above the option strike price, the option is "in-the-money. If the stock is below the strike price, the option is "out-of-the-money. If an option is out-of-the-money on the expiration date, the option has no stock and basically expires worthless and ceases to exist. When an option is in-the-money and expiration is approaching, you can make one of several different moves. For marketable options, the in-the-money value will be reflected in the option's market price. You can either sell the option to lock in the value or exercise the option to buy the options. If you hold in-the-money options until expiration, your broker will automatically exercise them for you and you will own the stock shares on Monday morning -- market options always expire on a Friday. For employee stock options, you need to make sure you exercise in-the-money options before they expire. Typically, the broker that handles employee stock options will allow you to get cash for the in-the-money dates or the shares. Employee stock options and market traded call options give you the right to buy stock at the strike price. The options markets also offers put options, which give you the right to sell shares at a preset price. A put option will be in-the-money if the stock is below the strike price and will be automatically exercised by your broker if the option is allowed to reach expiration. If the stock price is above the put option strike price, the option will expire without value. Check the value and make a decision dates your stock options before they expire. Option Functions A stock option gives you the right to purchase shares at a preset price. In The Money The relationship between the exercise or strike price of your options and the current market price of the stock determines much of the value of the options. Approaching Expiration If an option is out-of-the-money on the expiration date, the option has no value and basically expires worthless and ceases to exist. Puts Employee stock options and market traded call options give you the right to buy stock at the strike price. References The Options Guide: Stock Options Cheat Sheet Options to Buy Options if You Don't Own Stock How Does a Put Option Work? Why Is a Call Option Called a Call? What Is the Longest Term Stock Put You Can Buy? Tax Treatment expiration Selling Put Options. What Does It Mean to Exercise Stock Options? Stock Options Explained in Plain English Can You Sell Call Options You Purchased? How to Trade Leveraged Stock Options. What Is an Expired Option? Can I Buy a Stock Option and Close It the Next Day? More Articles You'll Love. Stock Options Explained in Plain English. Can You Sell Call Options You Purchased? How to Take Advantage of Theta Decay in Options. Stock Options Cheat Sheet. How to Buy Options if You Don't Own Stock. How Does a Put Options Work? Strategies for Trading During Options Expiration Week. About Us Careers Investors Media Advertise with Us Check out our sister sites. Privacy Policy Terms of Use Contact Us The Knot The Bump.
Options Trading Expiration: Understanding the Basics
Options Trading Expiration: Understanding the Basics
I come back to the normal job hunting process- searching from the internet and send resume for both accounting and equity analysis.
Consumers will then benefit from a greater supply ofgoods and services at lower prices.
I learned a lot by being exposed to different people that had different life experiences than I did.
But this is always the case with those who care more for their interpretation of Scripture than for real flesh and blood people.