DEFINITION of 'Gold Option'

An option to buy or sell gold bullion at a future date at a set price. The date (delivery date), quantity and price (strike price), are all predetermined. The option is just that, an option, and is therefore not an obligation on the part of the investor to either buy or sell the gold.


An option is similar to a futures contract in that the price, date and amount are preset for both. The main difference between the two is that a futures contract is an obligation, or promise, made by the investor to uphold the contract whereas an option is not obligation.

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  6. Put On A Call

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  1. What is the difference between options and futures?

    An option gives the buyer the right, but not the obligation to buy or sell a certain asset at a specific price at any time ... Read Answer >>
  2. Does the seller (the writer) of an option determine the details of the option contract?

    The quick answer is yes and no. It all depends on where the option is traded. An option contract is an agreement between ... Read Answer >>
  3. What is the difference between "right" and "obligation" on a call option?

    Learn what a call option is, what determines a buyer and seller of an option, and what the difference between a right and ... Read Answer >>
  4. Do you have to be an expert investor to trade put options?

    Learn about investing in put options and the associated risks. Explore how options can provide risk, which is precisely defined ... Read Answer >>
  5. What does the underlying of a derivative refer to?

    Find out more about derivative securities, what an underlying asset is and what the underlying assets refer to in stock options ... Read Answer >>
  6. How do I set a strike price for an option?

    Learn about the strike price of an option and how to set a strike price for call and put options depending on risk tolerance ... Read Answer >>
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