DEFINITION of 'Grantor'

1. A seller of either call or put options who profits from the premium for which the options are sold. Synonymous with option writer.

2. The creator of a trust, meaning the individual whose assets are put into the trust.


1. For example, say a writer has sold a call option, or assumed a short position in a call option. If the call option is exercised, then the writer has to sell the underlying stock at the strike price Conversely, if the writer sells a put option, he or she is said to be long, and must purchase the underlying stock at the strike price. Being a writer is relatively risky - especially on a naked position. This technique should not be used by those who are new to option markets.

2. The grantor is the person who creates the trust, and the beneficiaries are the persons identified in the trust to receive the assets.

  1. Dynasty Trust

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  2. Call

    1. The period of time between the opening and closing of some ...
  3. Writer

    The seller of an option who collects the premium payment from ...
  4. Naked Option

    A trading position where the seller of an option contract does ...
  5. Put

    An option contract giving the owner the right, but not the obligation, ...
  6. Premium

    1. The total cost of an option. 2. The difference between the ...
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