Options are among the most misunderstood investments, as many investors aren't familiar with even the most basic elements of how options work. Many people mistakenly assume that options are risky ...

Yes, so an option is a contract between a buyer and a seller. The buyer is paying a premium for the rights to execute upon that contract. The seller receives that premium. So think of it, if it ...

Basic Option Terms Trading stock options requires you to add a few new terms to your personal investing lexicon. Below are a few of the basic option terms that might be unfamiliar to rookies. For ...

To begin, let's review the basics of how options prices are maintained: The current decimal pricing of stocks and ETF's is such that the price per share is typically quoted in $.01 increments.

If you're looking to trade options, you'll need to start with the basics. Learn the differences between the two types of options: puts and calls.

Welcome to Option Basics , a series designed to help beginners dive into the world of option trading. Each week, we'll tackle a different piece of the option puzzle, and in no time, you'll be an ...

After the expiration, the option is settled and will no longer exist. Options contract: Options are generally sold in what’s called a contract, which represents 100 shares of the underlying stock.

In today's edition of Options Basics, we're going off the beaten path to learn how options are priced using the Black Scholes Formula. More than 30 years ago, Fischer Black, Robert Merton, and ...