Stock Option
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Definition of 'Stock Option'A privilege, sold by one party to another, that gives the buyer the right, but not the obligation, to buy (call) or sell (put) a stock at an agreed-upon price within a certain period or on a specific date.In the U.K., it is known as a "share option". |
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Investopedia explains 'Stock Option'American options can be exercised anytime between the date of purchase and the expiration date. European options may only be redeemed at the expiration date. Most exchange-traded stock options are American. |
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How do you tell whether an option is American or European style?
As a quick recap, American-style options are options that can be exercised at the strike price anytime before or on the date of expiration. European-style options, on the other hand, are options ... -
Why are options very active when they are at the money?
Stock options, whether they are put or call options, can become very active when they are at the money. In the money options refer to when the strike price of a call option is below the market ...
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