Buying And Selling Stock Options [TESTED]

: The fixed price at which the stock can be bought or sold if the option is exercised.

: The market price you pay to buy an option or receive when selling one. buying and selling stock options

Buying and selling stock options allows you to speculate on a stock's price direction or hedge existing positions with less upfront capital than buying shares outright. Unlike stocks, options are that give you the right (but not the obligation) to buy or sell 100 shares of a stock at a specific "strike price" before an "expiration date". Core Components of an Option : The fixed price at which the stock

: The final day the contract is valid; if not used by then, it expires worthless. Two Primary Types of Options Unlike stocks, options are that give you the

: One standard contract represents 100 shares of the underlying stock.