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In finance, a put or put option is a derivative instrument in financial markets that gives the holder (i.e. the purchaser of the put option) the right to sell an asset (the underlying), at a specified price (the strike), by (or on) a specified date (the expiry or maturity) to the writer (i.e. seller) of the put.
A call option is in the money when the strike price is below the spot price. A put option is in the money when the strike price is above the spot price. With an "in the money" call stock option, the current share price is greater than the strike price so exercising the option will give the owner of that option a profit.
Here’s what in-the-money options and out-of-the-money options are and how they differ. Skip to main content. 24/7 Help. For premium support please call: 800-290-4726 more ways to ...
How does a put option work and why would someone buy (or sell) one? Skip to main content. 24/7 Help. For premium support please call: 800-290-4726 more ways to reach us ...
Put option: A put option gives its buyer the right, but not the obligation, to sell a stock at the strike price prior to the expiration date. When you buy a call or put option, you pay a premium ...
Strike price labeled on the graph of a call option.To the right, the option is in-the-money, and to the left, it is out-of-the-money. In finance, the strike price (or exercise price) of an option is a fixed price at which the owner of the option can buy (in the case of a call), or sell (in the case of a put), the underlying security or commodity.
Reward/risk: In this example, the put breaks even when the stock closes at option expiration at $19 per share, or the strike price minus the $1 premium paid. Below $20 the put increases in value ...
For a call option, the option is in-the-money if the underlying spot price is higher than the strike price; then the intrinsic value is the underlying price minus the strike price. For a put option , the option is in-the-money if the strike price is higher than the underlying spot price; then the intrinsic value is the strike price minus the ...
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