An option is the right to buy or sell an asset at a certain price by a certain date. Let's say that a friend is selling a guitar for $1,000. Instead of selling you the guitar, the friend sells you the "option" to buy the guitar for $800 in a month. Your friend charges $100 for this right-to-buy option, ensuring that nobody except you can buy the guitar next month. One month later, you fork over the $800 for the guitar.
Tuesday 23 February 2016
Secured Options - How to Get Started Trading Options
An option is the right to buy or sell an asset at a certain price by a certain date. Let's say that a friend is selling a guitar for $1,000. Instead of selling you the guitar, the friend sells you the "option" to buy the guitar for $800 in a month. Your friend charges $100 for this right-to-buy option, ensuring that nobody except you can buy the guitar next month. One month later, you fork over the $800 for the guitar.
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