(FINANCE) a call option that is written by a party who possesses none of the underlying stock; a commitment to sell a fixed amount of something at a fixed price, of something one does not happen to have.
Writing an option means selling a certificate that guarantees the holder can buy a traded item for a guaranteed price (strike price). The person who writes the option is betting that the price of the underlying stock will go down (shorting a stock, AKA a short position). If the person writing the option is correct, then she makes money off the sale of the option, but does not have to worry about honoring the option, since it is out of the money and has no intrinsic value.
If the person writing the option is wrong, and the price of the underlying stock goes up, then she must buy the item at the higher spot price specifically to sell it at the low strike price ("short cover"). In rare cases, a person who makes this sort of error will actually drive the spot price much higher than it would have gone ordinarily.
Writing an option means selling a certificate that guarantees the holder can buy a traded item for a guaranteed price (strike price). The person who writes the option is betting that the price of the underlying stock will go down (shorting a stock, AKA a short position). If the person writing the option is correct, then she makes money off the sale of the option, but does not have to worry about honoring the option, since it is out of the money and has no intrinsic value.
If the person writing the option is wrong, and the price of the underlying stock goes up, then she must buy the item at the higher spot price specifically to sell it at the low strike price ("short cover"). In rare cases, a person who makes this sort of error will actually drive the spot price much higher than it would have gone ordinarily.
Naked option writing is quite risky because you can make only a limited amount of money. yet the risks are high.
by Abu Yahya April 15, 2010
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An alternative dish for those who choose not to participate in the consumption of meat and meat products
by lord blythe March 10, 2009
Get the Vegetarian option mug.A more vague term than crush, meaning you feel more indifferent about that person. However you wouldn't mind dating them.
* Can be derogatory when used in the right context.
* Can be derogatory when used in the right context.
Male A : Man I love passing in highschool, cause there's just so many options that walk by!
Male B : Word up man! Every 5 one of them's a banging chick.
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Female A : Wow, look at Johnny over there, isn't he just dreamy? 8)
Female B : Oh please Bertha, your not even an option for him. >_>
Female A : OH HELLZ NO, you did not just say that!
Male B : Word up man! Every 5 one of them's a banging chick.
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Female A : Wow, look at Johnny over there, isn't he just dreamy? 8)
Female B : Oh please Bertha, your not even an option for him. >_>
Female A : OH HELLZ NO, you did not just say that!
by XfBiM November 6, 2009
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Typically you are given two options, but you can always choose to poop instead.
This option is always available no matter what happens. It's almost never a good option to take, but it is important to know it's always there.
Typically you are given two options, but you can always choose to poop instead.
This option is always available no matter what happens. It's almost never a good option to take, but it is important to know it's always there.
by TheSwineFlew January 24, 2011
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Get the optional fact mug.Stock options are contracts you can buy or sell where you make a bet on what a stock's price will be at a certain time in the future (the strike and expiration). This allows you to massively leverage your investment since one contract holds 100 stocks.
People who invest in options like to use words like "gamma", "hedging", "condors", "premium" and "IV" to seem smart. In reality, most options traders are autists who consistently lose money and brag about it on wall street bets.
People who invest in options like to use words like "gamma", "hedging", "condors", "premium" and "IV" to seem smart. In reality, most options traders are autists who consistently lose money and brag about it on wall street bets.
Degenerate: "I just went long 29 stock option calls on TSLA at the 690$ strike expiring first weekly with a premium of 1.8$ per share and 400 delta."
Person: "Why can't you just say "I just made 29 bets that Tesla will go above 690$ by next Friday, I paid 180$ per bet and will make 400$ per dollar the stock moves"?"
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Degenerate: "I lost everything..."
Person: "Post it on r/wallstreetbets, you gotta get that Reddit karma!"
Person: "Why can't you just say "I just made 29 bets that Tesla will go above 690$ by next Friday, I paid 180$ per bet and will make 400$ per dollar the stock moves"?"
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Degenerate: "I lost everything..."
Person: "Post it on r/wallstreetbets, you gotta get that Reddit karma!"
by ScritchWasTaken December 29, 2020
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