The right to choose
Article Abstract:
There are differences between options and futures, though both relate to a fixed date in the future. Holders of options are able to exercise their rights prior to the expiry date, but they are under no obligation to do so. Holders of future have an obligation to purchase or sell at a given date. Futures markets offer a broader range of contracts, and generally more frequent delivery months. Screen-based trading should bring more liquidity to the market and remove differences between dealing spreads which had been characteristic of options and futures.
Publication Name: Investors Chronicle
Subject: Business
ISSN: 0261-3115
Year: 1998
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The principles of put and call
Article Abstract:
Options have existed for a long time, though they may appear to be modern and disreputable. Call options give the right to buy assets at a set price before a given date, and this involves a transfer of risk that prices could rise to the seller from the buyer. Options have been traded since 1978, though the market was initially small. They can be sold before their expiry date, and their value is affected by the length of time before expiry. Volatility also affects the price of options.
Publication Name: Investors Chronicle
Subject: Business
ISSN: 0261-3115
Year: 1998
User Contributions:
Comment about this article or add new information about this topic:
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