Two Contracts. Two Sides.

Lesson Overview:

• • Who exchanges options
    • Buyer
      • Pays for the right to do something
      • Typically takes a small amount of defined risk for a potentially large payout
    • Seller (often called the Writer)
      • Is paid for giving the right (and taking on the obligation)
      • You can sell options even if you don’t own them
  • What is a put option
    • From the buyer’s perspective, it’s the right to Sell
    • From the seller’s perspective, has the obligation to Buy 
    • Review practical purposes for buying and selling puts 
  • What is a call option
    • From the buyer’s perspective, gives the right to Buy
    • From the seller’s perspective, has the obligation to Sell
  • Review examples
  • Quiz
  • Journal