Basics Options Market online test

________ gives the buyer the right, but not obligation to buy.


QQQ (Cubes) Related to ______________


________ gives to buyer the right, but not obligation to sell.


ITM (In the money) Contract represents___________


ATM (in options) means_______?


Negative Cash Flow represents________


A stock option is an Example of


In options Call writting Means?


In Put option who recives the premium amount?


Pranai is expecting next month nifty will move towards 5900.

Present Nifty trading at 6050. So what to do?













Description:

In finance, an option is a contract which gives the buyer (the owner) the right, but not the obligation, to buy or sell an underlying asset or instrument at a specified strike price on or before a specified date. The seller incurs a corresponding obligation to fulfill the transaction – that is to sell or buy – if the owner elects to "exercise" the option prior to expiration. The buyer pays a premium to the seller for this right. An option which conveys to the owner the right to buy something at a specific price is called a call; an option which conveys the right of the owner to sell something at a specific price is called a put. Both are commonly traded, though in basic finance for clarity the call option is more frequently discussed.
Options valuation is a topic of ongoing research in academic and practical finance. For simplicity of discussion, the value of an option is commonly decomposed into two parts: The first of these is the "intrinsic value", which is defined as the difference between the market value of the underlying and the strike price of the given option. The second part depends on a set of other factors which, through a multi-variable, non-linear interrelationship, reflect the discounted expected value of that difference at expiration. Although options valuation has been studied at least since the nineteenth century, the contemporary approach is based on the Black–Scholes model which was first published in 1973.

Discussion

Sterlinghatton

The author's advice in his concluding paragraph really misses the point.
https://www.pbase.com/milenaglen/profile

679 days 14 hours 39 minutes ago

Pravallika B

I need clarity about 10th question answer.

868 days 19 hours 3 minutes ago

PRANAI KUMAR
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