Selling
a Put Option: When you sell a put you
receive a premium for the purchaser to have the right
to sell stock to you. If the decision is made by the
purchaser to exercise the put option, you will have to
purchase stock from them at the strike price written
in the contract. The strategy for selling a put option
is an up-trending stock chart or an increasing stock
value.
Complete Option
Description: A
complete option description consists of the following
information: the underlying stock, the expiration date
or month, the strike price, the type of option, and
the current premium. An example of a complete option
description: America Online Aug 150 Call at 6.
This description would indicate the following
information: the underlying stock to be America
Online, the expiration date to be August, the strike
price to be $150, the type of option is a call, and
the premium to be paid is $6 per share times 100
shares or $600.
Complete
Option Quote: A
complete option quote consists of the following
information: the underlying stocks symbol, the
expiration date or month and the type of option as a
symbol from the table below, and the strike price
symbol from the table on the following page. An
example of a complete option quote: AOL.HJ. This
quote would indicate the following information: the
underlying stock symbol to be AOL, which stands for
America Online, the expiration date and option type
symbol to be H which is an August call, and the strike
price symbol to be J which indicates $150 strike
price.
